EXHIBIT 13
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                                    INGERSOLL-RAND

                                         1995

                                    ANNUAL REPORT

                                          TO

                                     SHAREOWNERS







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                                  Table of Contents


          Financial Review and Management Analysis  . . . . . . . .    3-23

          Consolidated Statement of Income  . . . . . . . . . . . .      24

          Consolidated Balance Sheet  . . . . . . . . . . . . . . . .    25

          Consolidated Statement of Shareowners' Equity . . . . . .   26-27

          Consolidated Statement of Cash Flows  . . . . . . . . . .   28-29

          Notes to Consolidated Financial Statements  . . . . . . .   30-58

          Report of Management  . . . . . . . . . . . . . . . . . .      59

          Report of Independent Accountants . . . . . . . . . . . .      60





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                                Ingersoll-Rand Company
                       Financial Review and Management Analysis


          1995 Compared to 1994

             1995 will go down in the company's history as a year of
          financial records and the year of our largest acquisition.  Our
          financial achievements in 1995 were the result of a solid and
          stable domestic economy for most of our company's products,
          moderately growing European markets and the continuing benefits
          from asset management and productivity-improvement programs,
          which are becoming a daily thought process for more and more of
          our employees.

             Sales for 1995 exceeded $5.7 billion, which generated $497
          million of operating income and $270 million of net earnings 
          ($2.55 per share).  These results include our successful
          acquisition of Clark Equipment Company (Clark), effective June 1,
          1995.  Our 1995 results, before considering the positive benefits
          from the Clark acquisition, would have also established company
          records.

             The Clark acquisition (which is described in Note 2 to the
          Consolidated Financial Statements) will add more than $1 billion
          of sales on an annualized basis to the company's results.  
          Products include Melroe's Bobcat skid-steer loaders and compact
          excavators, Clark-Hurth axles and transmissions, Blaw-Knox pavers
          and Club Car golf cars and utility vehicles.

             The company's economic outlook for 1996 remains fairly
          consistent with last year and calls for a steady improvement in
          operating results based on continued stability in our domestic
          markets and continuing strength in our international markets. 
          These expectations are bolstered by aggressive asset management
          and productivity-improvement programs, as well as the company's
          focus on total quality management and reengineering efforts to
          accelerate our efficiency gains.

             A comparison of key financial data between 1995 and 1994
          follows:

          o  Net sales in 1995 established a record at $5.7 billion,
             reflecting a 27-percent improvement over 1994's total of $4.5
             billion.  Sales for 1995, excluding Clark, exceeded last
             year's total by approximately 10 percent, and also established
             a new record.  





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          o  Cost of goods sold in 1995 was 75.2 percent of sales compared
             to 74.9 percent in 1994.  Partial liquidations of LIFO (last-
             in, first-out) inventory lowered 1995 costs by only $3.4
             million ($2.1 million after-tax, or two cents per share) as
             compared to an $11.6 million ($7.1 million after-tax, or seven
             cents per share) liquidation in 1994.  Excluding the effects
             of the LIFO liquidations, the 1995 cost of goods sold
             percentage relationship to sales would have been 75.3 percent
             versus 75.2 percent for 1994.  The percentage of cost of goods
             sold to sales improved approximately one percent, excluding
             Clark and the loss on the paving business (a preacquisition
             requirement) from the calculation.  This reduction represents
             the benefits derived from the company's continuing
             productivity-improvement and reengineering programs.

          o  Administrative, selling and service engineering expenses were
             16.1 percent of sales in 1995, compared to 16.7 percent for
             1994.  The marked improvement was due to the continued effect
             of the company's efforts from productivity-improvement
             programs and the benefit of leverage from the increased sales
             volume, which were large enough to offset the effects of
             inflation for salaries, services, etc.  The effect of the
             Clark acquisition did not have a material impact on these
             percentages in 1995.

          o  Operating income for the year totalled $497.0 million, a 32
             percent increase over 1994's operating income of $377.0
             million.  Operating income in 1995, without Clark-related
             activities, totalled $435.1 million, reflecting a 15-percent
             increase over 1994's level.

          o  Interest expense for the year totalled $86.6 million, which is
             almost double 1994's level.  Interest costs associated with
             Clark's existing debt and its acquisition totalled $47.7
             million.  The company's interest expense, without Clark, would
             have been $38.9 million, an 11.2-percent reduction from the
             company's 1994 interest expense total of $43.8 million.  This
             is the result of lower interest rates and the company's
             aggressive asset management program.

          o  Other income (expense), net, is essentially the sum of three
             activities:  (i) foreign exchange, (ii) equity interests in
             partially-owned equity companies, and (iii) other
             miscellaneous income and expense items.  In 1995, this
             category netted to an income balance of $9.4 million, a
             favorable change of $24.1 million over 1994's net expense of
             $14.7 million.  A review of the components of this category
             shows that:




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             o foreign exchange activity for 1995 totalled $6.2 million of
               losses, which is comparable to the $6.1 million of losses in
               1994;

             o earnings from equity interests in partially-owned equity
               companies were approximately $12.5 million higher than
               1994's level, which included a loss on the sale of a
               partially-owned company; and

             o other net miscellaneous expense items were approximately
               one-half the prior year's level, principally due to higher
               gains on the sale of fixed assets, higher royalty earnings
               and a favorable benefit from the activities of the Clark
               units.

          o  Dresser-Rand Company (Dresser-Rand) is a partnership between
             the company and Dresser Industries, Inc. (Dresser).  It
             commenced operations on January 1, 1987, and comprises the
             worldwide reciprocating compressor and turbomachinery
             businesses of the two companies.  The company's pretax profits
             from its interest in Dresser-Rand for 1995 totalled $22.0
             million, as compared to $24.6 million in the prior year.  The
             reduction is primarily attributed to lower sales volumes in
             1995, when compared to 1994.  However, Dresser-Rand began 1996
             with a backlog in excess of $950 million.

          o  Ingersoll-Dresser Pump Company (IDP) is another partnership
             between the company and Dresser in which the company owns the
             majority interest.  In 1995, the minority interest charge was
             $12.7 million, as compared to the 1994 charge of $13.2
             million.  This charge reflects the portion of IDP's earnings
             that was allocable to our joint venture partner and indicates
             that IDP's earnings in 1995 were lower than in the prior year.

          o  The company's effective tax rate for 1995 was 37.0 percent,
             which represents a slight increase over the 36.0 percent
             reported for the prior year.  The variance from the 35.0
             percent statutory rate was due primarily to the higher tax
             rates associated with foreign earnings, the effect of state
             and local taxes and the nondeductibility of the goodwill
             associated with the Clark acquisition.

             At December 31, 1995, employment totalled 41,133.  This
          represents a net increase of 5,201 employees over last year's
          level of 35,932.  The Clark acquisition added 5,304 new
          employees, while employment levels in the company's traditional
          businesses declined by 103 people during 1995.





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          Liquidity and Capital Resources
          The most significant event affecting the company's liquidity
          during 1995 was the Clark acquisition, which became effective
          June 1, 1995.  The total purchase price paid for Clark was
          approximately $1.5 billion.  After considering the cash on
          Clark's books at the acquisition date, the actual cash cost of
          the transaction was approximately $1.1 billion.  The effects of
          this transaction will be discussed throughout this section of our
          report and additional information on the acquisition is described
          in Note 2 to the Consolidated Financial Statements.

             The following table contains several key measures which the
          company's management uses to gauge the company's financial
          performance:
                                                  1995      1994      1993
          Working capital (in millions)         $1,016      $963      $878
          Current ratio                            1.8       1.9       1.9
          Debt-to-total capital ratio               45%       22%       28%
          Average working capital 
             to net sales                         17.3%     20.4%     22.0%
          Average days outstanding
             in receivables                       63.1      64.6      64.1
          Average months' supply 
            of inventory                           3.3       3.7       4.4

             Ingersoll-Rand, as a large multinational company, maintains
          significant operations in foreign countries.  The movement of the
          U.S. dollar against foreign currencies has a day-to-day impact on
          the company's financial position.  This impact is not always
          apparent since the company reports its consolidated results in
          U.S. dollars.  Generally, the functional currency of the
          company's foreign subsidiaries is their local currency, the
          currency in which they transact their business.  During 1995,
          many foreign currencies strengthened against the U.S. dollar for
          most of the year and the effect of these foreign currency
          fluctuations was significant.  The company manages exposure to
          changes in foreign currency exchange rates through its normal
          operating and financing activities, as well as through the use of
          forward exchange contracts.  The company attempts, through its
          hedging activities, to mitigate the impact on the income
          statement of changes in foreign exchange rates.  Additionally,
          the company maintains operations in hyperinflationary economies
          and in countries, such as Mexico, where the company's operations
          transact business in U.S. dollars.  The functional currency of
          these operations has been and will remain the U.S. dollar. 
          (additional information on the company's use of financial
          instruments can be found in Note 9 to the Consolidated Financial
          Statements.)




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             The following highlights the financial results and financial
          condition of the company's operations, with the impact of
          currency variations where appropriate:

          o  Cash and cash equivalents totalled $137.3 million at December
             31, 1995, a $69.7 million decrease from the prior year-end
             balance of $207.0 million.  In evaluating the net change in
             cash and cash equivalents, cash flows from operating,
             investing and financing activities, and the effect of exchange
             rate changes, should be considered.  Cash flows from operating
             activities totalled $403.6 million, investing activities used
             $1,307.9 million and financing activities generated funds of
             $830.2 million.  Exchange rate changes during 1995 increased
             cash and cash equivalents by approximately $4.4 million.  

          o  Marketable securities totalled $9.3 million at the end of
             1995, $5.1 million more than the balance at December 31, 1994. 
             The increase was due to the investment of excess cash in
             various securities by foreign subsidiaries at favorable
             interest rates.  Foreign marketable securities decreased
             slightly during the year due to foreign exchange rate
             fluctuations.  

          o  Receivables totalled $1,109.9 million at December 31, 1995,
             compared to $949.4 million at the prior year end, for a net
             increase of $160.5 million.  Currency translation increased
             the receivable balance during the year by $16.0 million, and
             acquisitions added approximately $193 million during 1995. 
             However, the company's focus on decreasing its receivable base
             through its asset management program produced a $50.9 million
             reduction in receivables during the year, in spite of the
             heavy sales volume in the fourth quarter of 1995.  The average
             days outstanding in receivables decreased to 63.1 days from
             last year's level of 64.6 days, as benefits from the company's
             asset management program are beginning to be realized.

          o  Inventories amounted to $912.6 million at December 31, 1995,
             an increase of $233.3 million over last year's level of $679.3
             million.  Currency movements accounted for a $10.6 million
             increase in inventory for the year, while acquisitions (net of
             a contribution to a joint venture) accounted for an additional
             $207.5 million increase in inventory.  The remaining increase
             of $15.2 million reflects a year-end inventory build, to
             fulfill new orders during the first few months of the year
             based on the company's sales growth and backlog.  However, the
             company's emphasis on inventory control was reflected in the
             reduction of the average months' supply of inventory, which
             was 3.3 months at December 31, 1995, compared to 3.7 months at
             the prior year end.



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          o  Prepaid expenses totalled $58.0 million at the end of the
             year, $14.2 million higher than the balance at December 31,
             1994.  Foreign exchange activity had a minimal effect on the
             balance in this account, while acquisition activity accounted
             for an additional $8.3 million of the increase.  The remaining
             net increase for the year was due to a general increase in the
             company's prepaid expenses.

          o  Deferred income taxes (current) of $118.5 million at December
             31, 1995, represent the deferred tax benefit of the difference
             between the book and tax values of various current assets and
             liabilities.  A schedule of the components for this balance is
             in Note 14 to the Consolidated Financial Statements.  The
             year-end balance represented a decrease of $0.7 million from
             the December 31, 1994, level.  Changes due to foreign currency
             movements had no effect on the year's activity.

          o  The investment in Dresser-Rand Company totalled $93.9 million
             at December 31, 1995.  This represented a net increase of
             approximately $3.2 million from 1994's balance of $90.7
             million.  The components of the change for 1995 consisted of
             income for the current year of $22.0 million, and an $18.8
             million change in the advance account between the entities.  

          o  The investments in partially-owned equity companies at
             December 31, 1995, totalled $223.3 million, $49.4 million
             higher than the 1994 balance.  Income and dividends from
             investments in partially-owned equity companies were $26.2
             million and $6.7 million, respectively.  Amounts due from
             these units increased from $3.4 million to $20.4 million at
             December 31, 1995.  Currency movements relating to partially-
             owned equity companies were approximately $1 million in 1995. 
             During 1995, the company contributed approximately $11 million
             of assets for an equity interest in a European joint venture. 
             These assets were principally inventory and fixed assets.

          o  Net property, plant and equipment increased by $319.1 million
             in 1995 to a year-end balance of $1,278.4 million.  Fixed
             assets from acquisitions during 1995 added $292.0 million. 
             Capital expenditures in 1995 totalled $211.7 million, a
             33-percent increase over the prior year's level.  Foreign
             exchange fluctuations increased the net fixed asset values in
             U.S. dollars by approximately $12 million.  The remaining net
             decrease was the result of depreciation, sales and
             retirements, and a contribution of assets to a joint venture
             company.






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          o  Intangible assets, net, totalled $1,253.6 million at December
             31, 1995, as compared to $124.5 million at December 31, 1994,
             for a net increase of $1,129.1 million.  Acquisitions added
             $1,122.1 million of intangibles, primarily goodwill, during
             1995.  Goodwill from the Clark acquisition was approximately
             $740 million.  In addition, Clark had approximately $380
             million of goodwill when acquired.  Amortization expense
             accounted for a reduction of $25.3 million.  The remaining net
             change was attributable to an increase from currency
             fluctuations and an increase in the required pension
             intangible asset.

          o  Deferred income taxes (noncurrent) totalled $134.8 million at
             December 31, 1995.  This net deferred asset arose in 1992
             primarily because of the tax effects related to the adoption
             of SFAS No. 106 (Postretirement Benefits Other Than Pensions). 
             The 1995 balance was $60.4 million higher than the 1994
             balance principally due to taxes associated with or assumed as
             a result of the Clark acquisition.  A listing of the
             components which comprised the balance at December 31, 1995,
             can be found in Note 14 to the Consolidated Financial
             Statements.

          o  Other assets totalled $233.7 million at year end, an increase
             of $62.5 million from the December 31, 1994, balance of $171.2
             million.  The change in the account balance was primarily due
             to an increase in prepaid pensions and other noncurrent assets
             of approximately $19 million, with acquisition activity
             accounting for the balance of the increase.  Foreign exchange
             activity in 1995 had a minimal effect on the account balance
             during the year.

          o  Accounts payable and accruals totalled $1,129.8 million at
             December 31, 1995, an increase of $246.0 million from last
             year's balance of $883.8 million.  Acquisition activity during
             1995 accounted for $258.9 million of the increase and foreign
             exchange activity during the year added an additional $17.9
             million.  The company's aggressive cash management program
             accounted for the balance of the reduction.

          o  Loans payable were $155.4 million at the end of 1995 and
             reflects a $38.2 million increase over the $117.2 million at
             December 31, 1994.  Current maturities of long-term debt,
             included in loans payable, were $102.9 million and $4.2
             million at December 31, 1995 and 1994, respectively.  The
             company's aggressive cash management program accounted for an
             $81.5 million reduction in short-term debt for 1995, while
             acquisition activity and foreign currency fluctuations
             increased short-term debt during 1995 by $15.0 million and 



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             $5.9 million, respectively.  The change in current maturities
             of long-term debt included movement to current maturities of
             $103.5 million, payments of $17.9 million, acquired debt of
             $12.8 million and foreign exchange activity.

          o  Long-term debt, excluding current maturities, totalled
             $1,304.4 million, an increase of $988.5 million over the prior
             year's balance of $315.9 million.  The acquisition of Clark
             resulted in $900 million of long-term debt relating to the
             purchase of Clark.  The consolidation of Clark added another
             $195.4 million of debt to the company's balance sheet. 
             Foreign currency fluctuations increased this liability by an
             additional $0.9 million.  Reductions of $109.4 million in
             long-term debt were caused by the reclassification of $103.5
             million of current maturities to loans payable and the early
             payment of an additional $5.9 million of debt during the year.

          o  Postemployment liabilities at December 31, 1995, totalled
             $832.1 million, an increase of $313.8 million over the
             December 31, 1994, balance.  Postemployment liabilities
             include medical and life insurance postretirement benefits,
             long-term pension accruals and other noncurrent postemployment
             accruals.  The increase in the liability during 1995 is almost
             exclusively related to the Clark acquisition.  Postemployment
             liabilities represent the company's noncurrent liabilities in
             accordance with SFAS Nos. 87, 106 and 112. (See Notes 16 and
             17 to the Consolidated Financial Statements for additional
             information.)

          o  The Ingersoll-Dresser Pump Company (IDP) minority interest,
             which represents Dresser's interest in the IDP joint venture,
             totalled $170.8 million and $154.1 million at December 31,
             1995 and 1994, respectively.  Earnings allocable to IDP's
             minority interest totalled $12.7 million for 1995, while
             increases due to translation adjustments totalled $2.9
             million.  At December 31, 1995, Dresser had loans payable to
             IDP totalling $9.7 million, which was shown as a reduction in
             IDP's minority interest.  

          o  Other liabilities (noncurrent) at December 31, 1995, totalled
             $131.3 million, which were $94.0 million higher than the
             balance at December 31, 1994.  The net increase for 1995 is
             almost exclusively related to the Clark acquisition.  These
             obligations are not expected to be paid out in the company's
             next business cycle.  These accruals generally cover
             environmental obligations, legal accruals and other
             contractual obligations.





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          o  At the time of its acquisition by the company, Clark sponsored
             a Leveraged Employee Stock Ownership Plan (LESOP) for eligible
             employees.  In connection with the acquisition, the company
             purchased the LESOP's Clark shares for $176.6 million.  The
             company determined it would continue the LESOP to fund certain
             employee benefit plans.  At December 31, 1995, approximately
             1.9 million shares of the company's common stock were
             unallocated and the $70.2 million paid by the LESOP for those
             unallocated shares is classified as a reduction of
             shareowners' equity pending allocation to participants.  (See
             Note 12 to the Consolidated Financial Statements for
             additional information.)

             Other information concerning the company's financial
          resources, commitments and plans is as follows:

             The average amount of short-term borrowings outstanding,
          excluding current maturities of long-term debt, was $156.1
          million in 1995, compared to $141.9 million in 1994.  The
          weighted average interest rate during 1995 was 8.3%, compared to
          6.8% during the previous year.  The maximum amounts outstanding
          during 1995 and 1994 were $222.0 million and $181.6 million,
          respectively.  The increase in the 1995 average amount of
          short-term borrowings outstanding was attributable to short-term
          financings related to the Clark acquisition.

             The company had $800 million in domestic short-term credit
          lines at December 31, 1995, and $676 million of foreign credit
          available for working capital purposes, all of which were unused
          at the end of the year.  These facilities exceed projected
          requirements for 1996 and provide direct support for commercial
          paper and indirect support for other financial instruments, such
          as letters of credit and comfort letters.

             At December 31, 1995, the debt-to-total capital ratio was 45
          percent, as compared to 22 percent at the prior year end.  The
          significant change in the ratio at December 31, 1995, was
          primarily due to the acquisition of Clark, which initially added
          approximately $1.5 billion of debt to the company's balance sheet
          generating an initial debt-to-total capital ratio of 55 percent. 
          Since the acquisition, the company's continuing programs of
          inventory reductions and spending controls to generate cash, were
          used to reduce the company's overall debt obligations and lower
          the debt-to-total capital ratio to the 45-percent relationship at
          December 31, 1995.







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             In 1995, foreign currency adjustments increased shareowners'
          equity by approximately $20.7 million.  The change was due to the
          weakening of the U.S. dollar against other currencies in 
          countries where the company has significant operations and the
          local currencies are the functional currencies.  Currency
          fluctuations in France, Germany, Italy, India, Japan, Singapore
          and Spain accounted for over 90 percent of the change. 
          Inventories, accounts receivable, net property, plant and
          equipment, accounts payable and loans payable were the principal
          accounts affected.  

             As a result of the Clark acquisition, the company is involved
          in certain repurchase arrangements relating to product-
          distribution and product-financing activities.  As of December
          31, 1995, repurchase arrangements relating to product financing
          by an independent finance company approximated $102 million.  It
          is not practicable to determine the additional amount subject to
          repurchase solely under dealer distribution agreements.  Under
          the repurchase arrangements relating to product-distribution and
          product-financing activities when dealer terminations do occur, a
          newly selected dealer generally acquires the assets of the prior
          dealer and assumes any related financial obligation. 
          Accordingly, the risk of loss to the company is minimal.
          Historically, Clark incurred only immaterial losses relating to
          these arrangements.

             In 1995, the company continued to sell an undivided fractional
          ownership interest in designated pools of accounts and notes
          receivable up to a maximum of $150 million.  Similar agreements
          have been in effect since 1987.  These agreements expire in one-
          and two-year periods based on the particular pool of receivables
          sold.  The company intends to renew these agreements at their
          expiration dates with either the current institution or another
          financial institution using the basic terms and conditions of the
          existing agreements.  At December 31, 1995 and 1994, $150 million
          and $125 million, respectively, of such receivables remained
          uncollected.  

             Capital expenditures were $212 million and $159 million in
          1995 and 1994, respectively.  The company continues investing to
          improve manufacturing productivity, reduce costs and provide
          environmental enhancements and advanced technologies for existing
          facilities.  The capital expenditure program for 1996 is
          estimated at approximately $225 million, including carryover from
          projects approved in prior periods.  There are no planned
          projects that, either individually or in the aggregate, represent
          a material commitment for the company.  Many of these projects
          are subject to review and cancellation at the option of the
          company without incurring substantial charges.



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             As a result of high inflationary periods in the 1970s,
          experimental disclosure of supplementary information to measure
          the effects of inflation on historical financial statements in
          terms of the constant dollar and current costs was required. 
          While the company presented inflation-adjusted data, the
          information presented was based on assumptions, estimates and
          judgments, which were far from precise indicators of the effects
          of inflation on the company.  High inflationary trends have
          dissipated in recent years and, after a review of the effects of
          inflation, the company has determined that such information is
          neither material nor meaningful at this time.

          Environmental Matters
          The company is subject to extensive environmental laws and
          regulations.  We believe that the company, as well as industry in
          general, will be faced with increasingly stringent laws and
          regulations in the future.  As a result, the company has been and
          continues to be dedicated to an environmental program to reduce
          the utilization and generation of hazardous materials during the
          manufacturing process and to remediate identified environmental
          concerns.  As to the latter, the company currently is engaged in
          site investigations and remedial activities to address
          environmental cleanup from past operations at current and former
          manufacturing facilities, including the facilities added through
          the Clark acquisition.

             During 1995, the company spent approximately $6 million on
          capital projects for pollution abatement and control and an
          additional $8 million for environmental remediation expenditures,
          including operation and maintenance of existing environmental
          programs.  It should be noted that these amounts are difficult to
          estimate because environmental improvements are generally
          intertwined with the overall improvement costs at a particular
          plant, and the accurate estimate of which portion of an
          improvement or a capital expenditure relates to an environmental
          improvement is difficult to ascertain.  The company believes that
          these expenditure levels will continue and may increase over
          time.  Given the evolving nature of environmental laws,
          regulations and technology, the ultimate cost of future
          compliance is uncertain.

             The company is a party to environmental lawsuits and claims. 
          It has received notices of potential violations of environmental
          laws and regulations from the Environmental Protection Agency and
          similar state authorities, and is identified as a potentially
          responsible party (PRP) for cleanup costs at approximately 37
          federal Superfund and state remediation sites (including Clark-
          acquired PRP locations).  For all sites there are other PRPs and
          in most instances, the company's site involvement is minimal. 



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          While all PRPs may be jointly and severally liable to pay all
          site investigation and remediation costs, to date there is no
          indication the company will be liable for more than the costs of
          its own percentage of responsibility at any site.  Additional
          lawsuits and claims involving environmental matters are likely to
          arise from time to time in the future.

             Although uncertainties regarding environmental technology,
          state and federal laws and regulations and individual site
          information make estimating the liability difficult, management
          believes that the total liability for the cost of remediation and
          environmental lawsuits and claims will not have a material effect
          on the financial condition, results of operations, liquidity or
          cash flows of the company for any year.  It should be noted that
          when the company estimates its liability for environmental
          matters, such estimates are based on current technologies and the
          company does not discount its liability or assume any insurance
          recoveries.

          1994 Compared to 1993
          1994 marked a milestone in the company's history.  Its 1994
          financial performance registered record levels in sales of $4.5
          billion and record net earnings of $211.1 million, or $2.00 per
          share.  1994 was a year of achievement brought about by strong
          domestic markets for most of the company's products, recovering
          European markets and continued benefits from asset management and
          cost containment programs.

             The company's outlook for 1995 was for a steady improvement in
          operating results based on continued stability in our domestic
          markets and additional recoveries in our international markets. 
          As outlined in 1993, these expectations are supplemented by our
          aggressive cost-containment programs, our commitment to total
          quality management and a focus on reengineering our business
          processes to accelerate our efficiency gains.

             A comparison of key financial data between 1994 and 1993
          follows:

          o  Net sales in 1994 totalled $4.5 billion, representing an
             increase of $486 million over 1993 and establishing a new
             record high.  Net sales reflected strong increases in the
             Standard Machinery and Bearings, Locks and Tools segments.   









                                         129<PAGE>


                                                       EXHIBIT 13
                                                       Page 15 of 60


          o  Cost of goods sold in 1994 was 74.9 percent of sales, compared
             to 75.0 percent in 1993.  A partial liquidation of LIFO
             (last-in, first-out) inventories lowered 1994 costs by $11.6
             million ($7.1 million after-tax, or seven cents per share); a
             similar liquidation in 1993 lowered costs by $12.5 million
             ($7.6 million after-tax, or seven cents per share).  Excluding
             the benefit of the LIFO liquidations, the 1994 cost of goods
             sold percentage relationship to sales would have been 75.2
             percent versus 75.3 percent for 1993.  This reduction
             represented the benefit from the company's continuing programs
             of aggressive cost-containment.

          o  Administrative, selling and service engineering expenses were
             16.7 percent of sales in 1994, compared to 17.6 percent for
             1993.  The marked improvement was due to the continued effect
             of the company's efforts from cost-containment programs and
             the benefit of leverage from the increased sales volume which
             were large enough to offset the effects of inflation for
             salaries, services, etc.

          o  Operating income for the year totalled $377.0 million, an
             increase of 27.2 percent over 1993's operating income of
             $296.5 million, before the restructure of operations charge. 
             The 1993 restructure of operations charge totalled $5.0
             million and related to the company's decision to sell its
             underground coal-mining machinery business during the second
             quarter of the year.  The sale of this business was finalized
             in July 1993.  There were no restructuring charges in 1994.

          o  Interest expense for 1994 was $43.8 million, approximately 16
             percent lower than the $52.0 million reported for 1993.  The
             reduction was due to lower overall outstanding indebtedness,
             which was a result of the company's ongoing asset management
             program.

          o  The other income (expense), net, category is essentially the
             sum of three activities: (i) foreign exchange, (ii) equity
             interests in partially-owned equity companies, and (iii) other
             miscellaneous income and expense items.  In 1994, this
             category totalled a net expense balance of $14.7 million, a
             $7.2 million increase in net expense over 1993's level.  A
             review of the components of this category show that:

             o foreign exchange activity for 1994 totalled $6.1 million of
               losses, as compared to $6.6 million of losses in 1993;

             o earnings from equity interests in partially-owned equity
               companies were approximately $2 million lower than 1993's
               level, reflecting a 1994 loss on the sale of a partially-
               owned company; and


                                         130<PAGE>


                                                       EXHIBIT 13
                                                       Page 16 of 60


             o other net miscellaneous expense items were approximately
               double the 1993 level, principally due to lower gains on the
               sale of fixed assets and lower royalty earnings.

          o  Dresser-Rand Company is a partnership between the company and
             Dresser Industries, Inc. (Dresser).  It commenced operations
             on January 1, 1987, and comprises the worldwide reciprocating
             compressor and turbomachinery businesses of the two companies. 
             The company's pretax profits from its interest in Dresser-Rand
             for 1994 totalled $24.6 million, as compared to $33.1 million
             in 1993.  The reduction is attributed to the combination of an
             increase in expenses to establish a presence in Eastern
             Europe, increased depreciation charges due to the effect of
             equipment improvement programs during the past few years and
             lower production levels in some businesses.

          o  Ingersoll-Dresser Pump Company (IDP) is another partnership
             between the company and Dresser in which the company owns the
             majority interest.  In 1994, the minority interest charge was
             $13.2 million, as compared to the 1993 charge of $11.6
             million.  This charge reflects the portion of IDP's earnings
             that was allocable to our joint venture partner.  

          o  The company's effective tax rate for 1994 was 36.0 percent,
             which was a slight increase over the 35.5 percent reported for
             1993.  The variance from the 35.0 percent statutory rate was
             due primarily to the higher tax rates associated with foreign
             earnings and the effect of state and local taxes.

             At December 31, 1994, employment totalled 35,932.  This
          represents a net increase of 789 employees over 1993's level of
          35,143.  Acquisitions accounted for virtually all of this
          increase.

             The following highlights the financial results and financial
          condition of the company's operations, with the impact of
          currency variations where appropriate:

          o  Cash and cash equivalents totalled $207.0 million at December
             31, 1994, a $21.0 million decrease from the December 31, 1993
             balance of $228.0 million.  In evaluating the net change in
             cash and cash equivalents, cash flows from operating,
             investing and financing activities, and the effect of exchange
             rate changes, should be considered.  Cash flows from operating
             activities totalled $301.8 million, investing activities used
             $141.7 million and financing activities used $187.7 million. 
             Exchange rate changes during 1994 increased cash and cash
             equivalents by approximately $6.6 million.  




                                         131<PAGE>


                                                       EXHIBIT 13
                                                       Page 17 of 60


          o  Marketable securities totalled $4.2 million at the end of
             1994, $1.9 million less than the balance at December 31, 1993. 
             Foreign marketable securities increased by approximately $0.9
             million during the year due to foreign exchange rate
             fluctuations.  The remaining reduction was due to the maturity
             of the various securities and their liquidation into cash and
             cash equivalents.

          o  Receivables totalled $949.4 million at December 31, 1994,
             compared to $797.5 million at December 31, 1993, for a net
             increase of $151.9 million.  Currency translation increased
             the receivable balance during the year by $21.4 million, and
             acquisitions added approximately $20 million during 1994.  In
             addition, heavy sales volume in the 1994 fourth quarter
             contributed significantly to the increase.  Net sales for the
             fourth quarter of 1994 increased 14 percent over 1993's fourth
             quarter.  The average days outstanding in receivables
             increased slightly from 1993's level because of the higher mix
             of international receivables, which traditionally carry longer
             payment terms than domestic receivables and customers in
             certain domestic industries, who have implemented slightly
             longer payment terms.

          o  Inventories amounted to $679.3 million at December 31, 1994,
             $34.4 million lower than December 31, 1993's level of $713.7
             million.  This decrease was a result of the company's
             aggressive inventory control programs and record fourth
             quarter sales, which reduced inventory levels by approximately
             $82 million.  Currency movements accounted for a $21.3 million
             increase in inventory for the year, while acquisitions
             accounted for an additional $25.9 million increase in
             inventory.  The company's emphasis on inventory control was
             reflected in the reduction in the average months' supply of
             inventory, which was 3.7 months at December 31, 1994, compared
             to 4.4 months at December 31, 1993.

          o  Prepaid expenses totalled $43.8 million at the end of the
             year, $3.9 million higher than the balance at December 31,
             1993.  Foreign exchange activity had the effect of increasing
             the balance in this account by $1.9 million during the year. 
             The remaining net increase for the year was due to a general
             increase in the company's prepaid expenses of $1.3 million,
             and acquisitions contributed $0.7 million.









                                         132<PAGE>


                                                       EXHIBIT 13
                                                       Page 18 of 60


          o  Deferred income taxes (current) of $119.2 million at December
             31, 1994, represent the deferred tax benefit of the difference
             between the book and tax values of various current assets and
             liabilities.  A schedule of the components for this balance is
             in Note 14 to the Consolidated Financial Statements.  The
             year-end balance represented an increase of approximately $2
             million from the December 31, 1993, level.  Changes due to
             foreign currency movements had an immaterial effect on the
             year's activity.

          o  The investment in Dresser-Rand Company totalled $90.7 million
             at December 31, 1994.  This represented a net decrease of
             approximately $21.9 million from 1993's balance of $112.6
             million.  The components of the change for 1994 consisted of
             income for the current year of $24.6 million, a $48.9 million
             change in the advance account between the entities and a $2.4
             million increase due to currency fluctuations.

          o  The investments in partially-owned equity companies at
             December 31, 1994, totalled $173.9 million, $15.2 million
             higher than the 1993 balance.  Income and dividends from
             investments in partially-owned equity companies were $15.6
             million and $3.8 million, respectively.  Amounts due from
             these units decreased from $27.6 million to $3.4 million at
             December 31, 1994.  Currency movements relating to partially-
             owned equity companies were approximately $11.1 million in
             1994.  In 1994, the company acquired full ownership of a ball
             bearing joint venture with GMN Mueller of America, Inc.  The
             company also entered into a 50/50 joint venture, GHH-RAND
             Schraubenkompressoren GmbH & Co. KG, to manufacture airends. 
             Also in 1994, the assets of the IDP Australian operations were
             sold in return for shares of the purchaser.  The company also
             sold its interest in IRI International Corporation, a
             manufacturer of mobile drilling rigs.

          o  Net property, plant and equipment increased by approximately
             $84 million in 1994 to a year-end balance of $959.3 million. 
             Fixed assets from acquisitions during 1994 added $39.8
             million.  Capital expenditures in 1994 totalled $158.6
             million, a 20-percent increase over 1993's level.  Foreign
             exchange fluctuations increased the net fixed asset values in
             U.S. dollars by approximately $16.8 million.  The remaining
             net decrease was principally due to depreciation expense.









                                         133<PAGE>


                                                       EXHIBIT 13
                                                       Page 19 of 60


          o  Intangible assets, net, totalled $124.5 million at December
             31, 1994, as compared to $105.9 million at December 31, 1993,
             for a net increase of $18.6 million.  Amortization (which was
             charged to expense) accounted for a reduction of $6.8 million. 
             Acquisitions added $27.8 million of intangibles during 1994. 
             The remaining net change was attributable to an increase from
             currency fluctuations and a decrease in the required pension
             intangible asset.

          o  Deferred income taxes (noncurrent) totalled $74.4 million at
             December 31, 1994.  This net deferred asset arose in 1992
             primarily because of the tax effects related to the adoption
             of SFAS No. 106 (Postretirement Benefits Other Than Pensions). 
             The 1994 balance was $16.4 million lower than the 1993
             balance.  A listing of the components which comprised the
             balance at December 31, 1994, can be found in Note 14 to the
             Consolidated Financial Statements.

          o  Other assets totalled $171.2 million at December 31, 1994, an
             increase of approximately $41.2 million from the December 31,
             1993, balance of $130.0 million.  The change in the account
             balance was primarily due to an increase in prepaid pensions
             and acquisitions.  Foreign exchange activity in 1994 had a
             minimal effect on the account balance during the year.

          o  Accounts payable and accruals totalled $883.8 million at
             December 31, 1994, an increase of $121.4 million from December
             31, 1993's balance of $762.4 million.  The increase in the
             1994 balance is related to acquisitions, foreign exchange
             activity, and a general increase in trade accounts payable. 
             Acquisitions caused an increase of approximately $50 million
             and foreign currency activity added approximately $20 million.

          o  Loans payable were $117.2 million at the end of 1994, compared
             to $206.9 million at December 31, 1993.  Current maturities of
             long-term debt, included in loans payable, were $4.2 million
             and $82 million at December 31, 1994 and 1993, respectively. 
             Excluding the current maturities of long-term debt, short-term
             borrowings decreased by $24.4 million during 1994.  This
             balance can be attributed to a decrease in foreign short-term
             debt offset by increases in the total loans outstanding during
             1994 of $11.8 million due to foreign currency fluctuations and
             debt assumed from acquisitions.









                                         134<PAGE>


                                                       EXHIBIT 13
                                                       Page 20 of 60


          o  Long-term debt, excluding current maturities, totalled $315.9
             million at December 31, 1994, compared to $314.1 million at
             December 31, 1993, a net increase of $1.8 million.  This net
             increase was the result of additions to long-term debt of $2.3
             million, additions due to acquisitions of $6.9 million, a $0.4
             million increase from foreign currency fluctuations; reduced
             by transfers to loans payable for current maturities. 

          o  Postemployment liabilities at December 31, 1994, totalled
             $518.3 million, an increase of $2.5 million over the December
             31, 1993, balance.  Postemployment liabilities include medical
             and life insurance postretirement benefits, long-term pension
             accruals and other noncurrent postemployment accruals.
             Postemployment liabilities represent the company's noncurrent
             liabilities in accordance with SFAS Nos. 87, 106 and 112.  See
             Notes 16 and 17 to the Consolidated Financial Statements for
             additional information.

          o  The Ingersoll-Dresser Pump Company minority interest, which
             represents Dresser's interest in the IDP joint venture,
             totalled $154.1 million and $146.3 million at December 31,
             1994 and 1993, respectively.  Earnings allocable to IDP's
             minority interest totalled $13.2 million for 1994, while
             increases due to translation adjustments totalled $5.4
             million.  At December 31, 1994, Dresser had loans payable to
             IDP totalling $10.8 million which was shown as a reduction in
             IDP's minority interest.  Earnings allocable to IDP's minority
             interest totalled $11.6 million for 1993, which were virtually
             offset by translation adjustment and final valuation
             modifications.

          o  Other liabilities (noncurrent) at December 31, 1994, totalled
             $37.3 million, which were $12.4 million higher than the
             balance at December 31, 1993.  The net increase for 1994
             represented changes to various accruals primarily due to
             acquisitions, which are not expected to be paid out in the
             company's next business cycle.  These accruals generally cover
             environmental obligations, legal accruals, and other
             contractual obligations.

             Other information concerning the company's financial
          resources, commitments and plans is as follows:










                                         135<PAGE>


                                                       EXHIBIT 13
                                                       Page 21 of 60


             The average amount of short-term borrowings outstanding,
          excluding current maturities of long-term debt, was $141.9
          million in 1994, compared to $159.1 million in 1993.  The
          weighted average interest rate during 1994 was 6.8%, compared to
          7.8% during 1993.  The maximum amounts outstanding during 1994
          and 1993 were $181.6 million and $184.1 million, respectively. 
          The decrease in the 1994 average amount of short-term borrowings
          outstanding was attributable to the company's foreign operations,
          which used short-term debt financings as a hedge against currency
          movements.

             The company had a $400 million domestic short-term credit line
          at December 31, 1994, and $466 million of foreign credit
          available for working capital purposes, all of which were unused
          at the end of the year.  These facilities provide direct support
          for commercial paper and indirect support for other financial
          instruments, such as letters of credit and comfort letters.

             At December 31, 1994, the debt-to-total capital ratio was 22
          percent, as compared to 28 percent at December 31, 1993.  The
          significant improvement in the ratio at December 31, 1994, was
          primarily due to the company's continuing programs of inventory
          reductions and spending controls to generate cash, which was used
          to reduce the company's overall debt obligations.

             In 1994, foreign currency adjustments increased shareowners'
          equity by $38.4 million.  The change was due to the weakening of
          the U.S. dollar against other currencies in  countries where the
          company has significant operations and the local currencies are
          the functional currencies.  Currency fluctuations in the United
          Kingdom, Canada, France, Italy, Germany, Australia, Singapore,
          Japan and Spain accounted for approximately 80 percent of the
          change.  Inventories, accounts receivable, net property, plant
          and equipment, accounts payable and loans payable were the
          principal accounts affected.  

             In 1994, the company continued to sell an undivided fractional
          ownership interest in designated pools of accounts and notes
          receivable up to a maximum of $125 million.  Similar agreements
          have been in effect since 1987.  These agreements expire in one-
          and two-year periods based on the particular pool of receivables
          sold.  The company intends to renew these agreements at their
          expiration dates with either the current institution or another
          financial institution using the basic terms and conditions of the
          existing agreements.  At December 31, 1994 and 1993, $125 million
          of such receivables remained uncollected.  






                                         136<PAGE>


                                                       EXHIBIT 13
                                                       Page 22 of 60


          REVIEW OF BUSINESS SEGMENTS


          Standard Machinery
          Standard Machinery Segment sales were $2.3 billion, an increase
          of 57 percent over the $1.4 billion reported for 1994.  Operating
          income for 1995, totalled $222.6 million, representing an
          increase of 82 percent over last year's total of $122.4 million. 
          This segment now includes all of the operations of Clark, except
          for Clark-Hurth, effective June 1, 1995.  Without the sales from
          the Clark units, 1995 sales were $1.7 billion, or $266.9 million
          higher than 1994's level.  Operating income, without the Clark
          units was $157.0 million, an increase of 28 percent over 1994's
          results.

             The Construction and Mining Group's sales for 1995, excluding
          the Blaw-Knox unit from Clark, were more than 20 percent higher
          than last year's level due to strong domestic markets and
          improved conditions in international markets.  The group's
          operating income and operating income margins improved markedly
          over 1994's results.  Sales for the Air Compressor Group were
          approximately 15 percent higher than 1994's level based on
          continued strong demand for its products both domestically and
          internationally.  The group reported a double-digit increase in
          operating income for the year.  The operations of the Clark
          units, which are now included within this segment (i.e. Melroe
          Company, Club Car, Inc. and Blaw-Knox Construction Equipment
          Corporation) generated over $500 million in sales and produced
          approximately $60 million of operating income since the June 1,
          1995, acquisition date.  However, it should be noted that the
          operations of Club Car and Blaw-Knox are traditionally more
          profitable during the first half of the year than in the latter
          half.


          Engineered Equipment
          Engineered Equipment Segment sales for 1995 totalled $1.2
          billion, or 31 percent above 1994's level.  Operating income was
          $49.5 million, representing a 40-percent increase over the 1994
          total of $35.3 million.  This segment also includes the results
          of Clark-Hurth Components Company (Clark-Hurth), effective June
          1, 1995.  Excluding the sales from Clark-Hurth, 1995 segment
          sales were $1,011.3 million, a nine-percent increase over 1994's
          level.  Operating income, without Clark-Hurth, totalled $41.6
          million, representing an 18-percent increase over the amount
          reported for the twelve months ended December 31, 1994.






                                         137<PAGE>


                                                       EXHIBIT 13
                                                       Page 23 of 60


             IDP's sales in 1995 reflected a marginal improvement over
          1994's level; however, they reported lower operating income in
          1995 versus 1994 due to lower margins on some large 1995 orders.  
          Sales and operating income in the Process Systems Group reflected
          significant improvement over 1994 levels due to the continued
          strength in the pulp and paper industry.  (See Note 18 to the
          Consolidated Financial Statements concerning the potential sale
          of the Pulp Machinery Division.)


          Bearings, Locks and Tools
          In 1995, the Bearings, Locks and Tools Segment reported sales of
          $2.2 billion, a five-percent increase over the prior year. 
          Operating income totalled $269.1 million, an increase of more
          than $12 million over the $256.6 million reported for 1994.  

             Bearings and Components Group sales for 1995 exceeded the
          prior year's level by more than six percent.  A strong domestic
          automotive industry and continued benefits from cost-containment
          programs generated improved operating income for this group in
          1995.

             Architectural Hardware Group sales were slightly below 1994's
          level.  The group's operating income for the year was also below
          1994's level by approximately five percent.  The decline in sales
          and operating income can be attributed to system problems during
          the third quarter of the year when a new system failed to meet
          expectations, and caused problems, such as shipment delays. 
          These problems were corrected by the end of the year.

             The Production Equipment Group sales and operating income in
          1995 reflected improvements over the amounts reported for the
          prior year.  An improving economy in the European-served area and
          stronger domestic markets contributed to the group's improved
          results for 1995.












                                         138<PAGE>


                                                       EXHIBIT 13
                                                       Page 24 of 60


          Consolidated Statement of Income                                  

          In millions except per share amounts
          For the years ended December 31     1995         1994         1993
          Net sales                       $5,729.0     $4,507.5     $4,021.1
          Cost of goods sold               4,310.2      3,377.1      3,016.7
          Administrative, selling and
            service engineering 
            expenses                         921.8        753.4        707.9
          Restructure of operations-
            charge                              --           --         (5.0)
          Operating income                   497.0        377.0        291.5
          Interest expense                   (86.6)       (43.8)       (52.0)
          Other income (expense), net          9.4        (14.7)        (7.5)
          Dresser-Rand income                 22.0         24.6         33.1
          Ingersoll-Dresser Pump 
            minority interest                (12.7)       (13.2)       (11.6)
          Earnings before income taxes
            and effect of accounting
            change                           429.1        329.9        253.5
          Provision for income taxes         158.8        118.8         90.0
          Earnings before effect of
            accounting change                270.3        211.1        163.5
          Effect of accounting change
            for postemployment benefits
            (net of tax benefits)               --           --        (21.0)
          Net earnings                    $  270.3     $  211.1     $  142.5
          Earnings per share of 
            common stock:
          Earnings before effect 
            of accounting change             $2.55        $2.00        $1.56
          Effect of accounting change
            for postemployment benefits         --           --        (0.20)
          Net earnings per share             $2.55        $2.00        $1.36
          See accompanying notes to consolidated financial statements.





                                          139<PAGE>


                                                       EXHIBIT 13
                                                       Page 25 of 60


          Consolidated Balance Sheet                                       

          In millions except share amounts
          December 31                                     1995         1994
          Assets
          Current assets:
          Cash and cash equivalents                   $  137.3     $  207.0
          Marketable securities                            9.3          4.2
          Accounts and notes receivable, less
            allowance for doubtful accounts of
            $38.3 in 1995 and $25.9 in 1994            1,109.9        949.4
          Inventories                                    912.6        679.3
          Prepaid expenses                                58.0         43.8
          Deferred income taxes                          118.5        119.2
                                                       2,345.6      2,002.9
          Investments and advances:
          Dresser-Rand Company                            93.9         90.7
          Partially-owned equity companies               223.3        173.9
                                                         317.2        264.6
          Property, plant and equipment, at cost:
          Land and buildings                             682.9        557.3
          Machinery and equipment                      1,522.3      1,261.3
                                                       2,205.2      1,818.6
          Less-accumulated depreciation                  926.8        859.3
                                                       1,278.4        959.3
          Intangible assets, net                       1,253.6        124.5
          Deferred income taxes                          134.8         74.4
          Other assets                                   233.7        171.2
                                                      $5,563.3     $3,596.9
          Liabilities and Equity
          Current liabilities:                              
          Accounts payable and accruals               $1,129.8     $  883.8
          Loans payable                                  155.4        117.2
          Customers' advance payments                     17.7         16.9
          Income taxes                                    26.3         22.1
                                                       1,329.2      1,040.0
          Long-term debt                               1,304.4        315.9
          Postemployment liabilities                     832.1        518.3
          Ingersoll-Dresser Pump Company
            minority interest                            170.8        154.1
          Other liabilities                              131.3         37.3
          Shareowners' equity:
          Common stock, $2 par value, authorized 
            400,000,000 shares; issued:  
            1995-109,704,883; 1994-109,168,872           219.4        218.3
          Capital in excess of par value                 121.6         42.4
          Earnings retained for use in the business    1,595.5      1,403.7
                                                       1,936.5      1,664.4
          Less:
          - Unallocated LESOP shares, at cost             70.2           --
          - Treasury stock, at cost                       11.5         53.1
          - Foreign currency equity adjustment            59.3         80.0
          Shareowners' equity                          1,795.5      1,531.3
                                                      $5,563.3     $3,596.9
          See accompanying notes to consolidated financial statements.
                                         140<PAGE>


                                                       EXHIBIT 13
                                                       Page 26 of 60


     Consolidated Statement of Shareowners' Equity                            

     In millions except share data
     December 31                                  1995         1994        1993

     Common stock, $2 par value:
       Balance at beginning of year           $  218.3     $  217.9    $  216.6
       Exercise of stock options
         and SARs                                  1.0           .2         1.1
       Issuance of shares under
         stock plans                                .1           .2          .2
       Balance at end of year                    219.4        218.3       217.9
     Capital in excess of par value:
       Balance at beginning of year               42.4         34.9        17.1
       Exercise of stock options and
         SARs including tax benefits              14.6          3.3        14.3
       Issuance of shares under
         stock plans                               2.0          4.2         3.5
       Sale of treasury shares to LESOP           62.7           --          --
       Allocation of LESOP shares to
         employees                                (0.1)          --          --
       Balance at end of year                    121.6         42.4        34.9
     Earnings retained for use
       in the business:
       Balance at beginning of year            1,403.7      1,268.5     1,199.5
       Net earnings                              270.3        211.1       142.5
       Cash dividends                            (78.5)       (75.9)      (73.5)
       Balance at end of year                  1,595.5      1,403.7     1,268.5
     Unallocated leveraged employee
       stock ownership plan:
       Balance at beginning of year                 --           --          --
       Purchase of treasury shares               (73.1)          --          --
       Allocation of shares to employees           2.9           --          --
       Balance at end of year                    (70.2)          --          --
     Treasury stock-at cost:
       Common stock, $2 par value:
       Balance at beginning of year              (53.1)       (53.1)      (53.1)
       Sale of treasury shares to LESOP           41.6           --          --
       Balance at end of year                    (11.5)       (53.1)      (53.1)
     Foreign currency
       equity adjustment:
       Balance at beginning of year              (80.0)      (118.4)      (86.7)
       Adjustments due to
         translation changes                      20.7         38.4       (31.7)
       Balance at end of year                    (59.3)       (80.0)     (118.4)
     Total shareowners' equity                $1,795.5     $1,531.3    $1,349.8






                                         141<PAGE>


                                                       EXHIBIT 13
                                                       Page 27 of 60


     Shares of Capital Stock
     Common stock, $2 par value:
       Balance at beginning of year     109,168,872  108,939,462  108,276,462
       Exercise of stock options
         and SARs                           474,250      112,850      547,400
       Issuance of shares under
         stock plans                         61,761      116,560      115,600
       Balance at end of year           109,704,883  109,168,872  108,939,462
     Unallocated leveraged employee
       stock ownership plan:
       Common stock, $2 par value:
       Balance at beginning of year              --           --           --
       Purchase of treasury shares        2,878,008           --           --
       Allocated to prior Clark
         participants                      (862,680)          --           --
       LESOP shares allocated to
         employees                          (78,130)          --           --
       Balance at end of year             1,937,198           --           --
     Treasury stock:
       Common stock, $2 par value:
       Balance at beginning of year       3,672,732    3,672,732    3,672,822
       Sale of shares to LESOP           (2,878,008)          --           --
       Disposition of stock                      --           --          (90)
       Balance at end of year               794,724    3,672,732    3,672,732


     See accompanying notes to consolidated financial statements.



























                                      142


                                                       EXHIBIT 13
                                                       Page 28 of 60


     Consolidated Statement of Cash Flows                                      

     In millions
     For the years ended December 31               1995         1994       1993
     Cash flows from operating activities:
       Net earnings                           $   270.3      $ 211.1    $ 142.5
       Adjustments to arrive at net cash
         provided by operating activities:
         Depreciation and amortization            179.4        132.5      123.5
         Gain on sale of assets                    (3.6)         (.1)      (5.5)
         Loss on disposition of domestic
           paving business                          7.1           --         --
         Minority interests                        14.0         13.8       13.6
         Equity earnings/losses, 
           net of dividends                       (41.5)       (36.4)     (45.6)
         Deferred income taxes                     15.1         14.2      (14.8)
         Other noncash items                        1.4        (10.5)        .1
         Effect of accounting changes                --           --       21.0
         Restructure of operations                   --           --        5.0
       Changes in assets and liabilities
         (Increase) decrease in:
           Accounts and notes receivable           50.9       (111.8)     (12.0)
           Inventories                            (15.2)        81.6       35.5
           Other current and noncurrent
             assets                               (33.1)       (14.6)     (22.3)
         (Decrease) increase in:
           Accounts payable and accruals          (37.9)        41.5      (73.3)
           Other current and noncurrent
             liabilities                           (3.3)       (19.5)      (2.8)
         Net cash provided by operating
           activities                             403.6        301.8      164.9
     Cash flows from investing activities:
       Capital expenditures                      (211.7)      (158.6)    (132.0)
       Proceeds from sales of property,
         plant and equipment                       26.5          7.3        6.6
       Proceeds from business dispositions           --          2.2       55.5
       Acquisitions, net of cash*              (1,136.5)       (37.8)     (42.5)
       (Increase) decrease in marketable
         securities                                (4.6)         2.8        6.4
       Cash (invested in) or advances (to)
           from equity companies                   18.4         42.4       45.3
         Net cash used in investing
           activities                          (1,307.9)      (141.7)     (60.7)
     Cash flows from financing activities:
       Decrease in short-term borrowings          (81.5)       (31.4)     (49.5)
       Debt issuance costs                         (6.0)          --         --
       Proceeds from long-term debt               901.7          2.3      101.8
       Payments of long-term debt                 (23.7)       (85.7)     (78.0)
       Net change in debt                         790.5       (114.8)     (25.7)
       Proceeds from exercise of stock
         options and treasury stock sales         118.2          3.0       13.1
       Dividends paid                             (78.5)       (75.9)     (73.5)
         Net cash provided by (used in)
           financing activities                   830.2       (187.7)     (86.1)

                                         143<PAGE>


                                                       EXHIBIT 13
                                                       Page 29 of 60


     Consolidated Statement of Cash Flows (Continued)                          

     In millions
     For the years ended December 31               1995         1994       1993

     Effect of exchange rate changes on cash
       and cash equivalents                         4.4          6.6       (6.9)
       Net (decrease) increase in cash
         and cash equivalents                     (69.7)       (21.0)      11.2
       Cash and cash equivalents-
         beginning of year                        207.0        228.0      216.8
     Cash and cash equivalents-end of year    $   137.3      $ 207.0    $ 228.0

     *Acquisitions:
       Working capital, other than cash       $  (161.4)     $  15.9    $ (25.6)
       Property, plant and equipment             (292.0)       (39.8)     (25.9)
       Intangibles and other assets            (1,330.0)       (32.6)      (2.0)
       Long-term debt and other liabilities       646.9         18.7       11.0
         Net cash used to acquire businesses  $(1,136.5)     $ (37.8)   $ (42.5)

     Cash paid during the year for:
       Interest, net of amounts capitalized   $    72.1      $  47.3    $  47.4
       Income taxes                               120.1        119.8      127.0
     See accompanying notes to consolidated financial statements.




                                         144<PAGE>


                                                       EXHIBIT 13
                                                       Page 30 of 60



          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


          NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
          Ingersoll-Rand is a multinational manufacturer of primarily
          nonelectrical industrial machinery and equipment.  The company's
          principal lines of business are air compressors, construction
          equipment, automotive parts and components, pumps, tools, door
          hardware products, golf cars and utility vehicles.  The company's
          broad product line has applications in numerous industries
          including automotive, construction, mining, utilities, paper,
          housing, recreational, as well as the general industrial market. 
          A summary of significant accounting policies used in the
          preparation of the accompanying financial statements follows:

          Principles of Consolidation:  The consolidated financial
          statements include the accounts of all wholly-owned and
          majority-owned subsidiaries.  Intercompany transactions and
          balances have been eliminated.  Partially-owned equity companies
          are accounted for under the equity method.  In conformity with
          generally accepted accounting principles, management has used
          estimates and assumptions that affect the reported amounts of
          assets, liabilities, revenues and expenses and the disclosure of
          contingent assets and liabilities.  Actual results could differ
          from those estimates.

          Cash Equivalents:  The company considers all highly liquid
          investments, consisting primarily of time deposits and commercial
          paper with maturities of three months or less when purchased, to
          be cash equivalents.  Cash equivalents were $40.0 million and
          $108.3 million at December 31, 1995 and 1994, respectively.

          Inventories:  Inventories are generally stated at cost, which is
          not in excess of market.  Domestic manufactured inventories of
          standard products are valued on the last-in, first-out (LIFO)
          method and all other inventories are valued using the first-in,
          first-out (FIFO) method.

          Property and Depreciation:  The company principally uses
          accelerated depreciation methods for assets placed in service
          prior to December 31, 1994 and the straight-line method for
          assets acquired subsequent to that date.    









                                         145<PAGE>


                                                       EXHIBIT 13
                                                       Page 31 of 60


          Intangible Assets:  Intangible assets primarily represent the
          excess of the purchase price of acquisitions over the fair value
          of the net assets acquired.  Such excess costs are being
          amortized on a straight-line basis over various periods not
          exceeding 40 years.  Goodwill at December 31, 1995 and 1994, was
          $1.2 billion and $114 million, respectively.  The carrying value
          of goodwill is evaluated periodically in relation to the
          operating performance and future undiscounted net cash flows of
          the related business.  Intangible assets also represent costs
          allocated to patents, tradenames and other specifically
          identifiable assets arising from business acquisitions.  These
          assets are amortized on a straight-line basis over their
          estimated useful lives.  Accumulated amortization at December 31,
          1995 and 1994, was $47.0 million and $26.5 million, respectively. 
          Amortization of intangible assets was $25.3 million, $6.8 million
          and $5.9 million in 1995, 1994 and 1993, respectively.

          Income Taxes:  Deferred taxes are provided on temporary
          differences between assets and liabilities for financial
          reporting and tax purposes as measured by enacted tax rates
          expected to apply when temporary differences are settled or
          realized.  

          Environmental Costs:  Environmental expenditures relating to
          current operations are expensed or capitalized as appropriate. 
          Expenditures relating to existing conditions caused by past
          operations, which do not contribute to current or future
          revenues, are expensed.  Costs to prepare environmental site
          evaluations and feasibility studies are accrued when the company
          commits to perform them.  Liabilities for remediation costs are
          recorded when they are probable and reasonably estimable,
          generally the earlier of completion of feasibility studies or the
          company's commitment to a plan of action.  The assessment of this
          liability is calculated based on existing technology, does not
          reflect any offset for possible recoveries from insurance
          companies and is not discounted.  There were no material changes
          in the liability for the periods presented.

          Revenue Recognition:  Sales of products are recorded for
          financial reporting purposes generally when the products are
          shipped.

          Research, Engineering and Development Costs:  Research and
          development expenditures, including engineering costs, are
          expensed when incurred and amounted to $190.4 million in 1995,
          $154.6 million in 1994 and $150.1 million in 1993.






                                         146<PAGE>


                                                       EXHIBIT 13
                                                       Page 32 of 60


          Foreign Currency:  Assets and liabilities of foreign entities,
          where the local currency is the functional currency, have been
          translated at year-end exchange rates, and income and expenses
          have been translated using weighted average-for-the-year exchange
          rates.  Adjustments resulting from translation have been recorded
          in shareowners' equity and are included in net earnings only upon
          sale or liquidation of the underlying foreign investment.
             For foreign entities where the U.S. dollar is the functional
          currency, including those operating in highly inflationary
          economies, inventory and property balances and related income
          statement accounts have been translated using historical exchange
          rates, and resulting gains and losses have been credited or
          charged to net earnings.
             Foreign currency transactions and translations recorded in the
          income statement decreased net earnings by $3.9 million, $5.1
          million and $4.7 million in 1995, 1994 and 1993, respectively. 
          Shareowners' equity was increased in 1995 by $20.7 million,
          increased in 1994 by $38.4 million and reduced in 1993 by $31.7
          million, due to foreign currency equity adjustments related to
          translation.
             The company hedges certain foreign currency transactions and
          firm foreign currency commitments by entering into forward
          exchange contracts (forward contracts).  Gains and losses
          associated with currency rate changes on forward contracts
          hedging foreign currency transactions are recorded currently in
          income.  Gains and losses on forward contracts hedging firm
          foreign currency commitments are deferred off-balance sheet and
          included as a component of the related transaction, when
          recorded; however, a loss is not deferred if deferral would lead
          to the recognition of a loss in future periods.
             Cash flows resulting from forward contracts accounted for as
          hedges of identifiable transactions or events are classified in
          the same category as the cash flows from the items being hedged.

          Earnings Per Share:  Net earnings per share of common stock are
          earnings divided by the average number of common shares
          outstanding during the year.  The effect of common stock
          equivalents on earnings per share was not material.  








                                         147<PAGE>


                                                       EXHIBIT 13
                                                       Page 33 of 60


          Accounting Changes:  The company principally uses accelerated
          depreciation methods for both tax and financial reporting
          purposes for assets placed in service prior to December 31, 1994. 
          The company changed to the straight-line method for financial
          reporting purposes for assets acquired on or after January 1,
          1995, while continuing to use accelerated depreciation for tax
          purposes.  The straight-line method is the predominant method
          used throughout the industries in which the company operates and
          its adoption increases the comparability of the company's results
          with those of its competitors.  The effect of the change on the
          year ended December 31, 1995, increased net earnings by
          approximately $6.8 million ($0.06 per share).
             The company implemented Statement of Financial Accounting
          Standards (SFAS) No. 115, "Accounting for Certain Investments in
          Debt and Equity Securities," effective January 1, 1994.  Adoption
          of this statement had no impact on the financial statements.
             Effective January 1, 1993, the company adopted SFAS No. 112,
          "Employers' Accounting for Postemployment Benefits."  SFAS  No.
          112 requires an accrual for the expected cost of benefits
          provided by an employer to former or inactive employees after
          employment, but before retirement, such as the continuation of
          medical and life insurance benefits for employees on long-term
          disability.  Previously, these benefits were expensed as
          incurred.  The effect of the adoption of SFAS No. 112 for the
          company totalled $21.0 million ($0.20 per share), net of a $13.5
          million tax benefit.  

          New Accounting Standards:  In March 1995, the Financial
          Accounting Standards Board (FASB) issued SFAS No. 121 "Accounting
          for Impairment of Long-Lived Assets and for Long-Lived Assets to
          Be Disposed Of," which became effective on January 1, 1996.  The
          adoption of SFAS No. 121 is not expected to have a material
          impact on the company's consolidated financial statements.  Also
          in 1995, the FASB issued SFAS No. 123, "Accounting for Stock-
          Based Compensation" which requires companies to measure employee
          stock compensation plans based on the fair value method of
          accounting or to continue to apply APB No. 25, "Accounting for
          Stock Issued to Employees" and provide pro forma footnote
          disclosures under the fair value method in SFAS No. 123.  The
          company will continue to apply the principles of APB No. 25 and
          provide pro forma fair value disclosures starting in the 1996
          Annual Report.




                                         148<PAGE>


                                                       EXHIBIT 13
                                                       Page 34 of 60


          NOTE 2 - ACQUISITIONS OF BUSINESSES:  On May 25, 1995, CEC
          Acquisition Corp. (CEC), a wholly-owned subsidiary of the
          company, acquired 16,553,617 shares of Clark Equipment Company
          (Clark), which, together with shares already owned by the
          company, represented approximately 98.4 percent of the
          outstanding shares, for a cash price of $86 per share pursuant to
          an April 12, 1995, amended tender offer.  On May 31, 1995, the
          company completed the merger of CEC with Clark.  Upon
          consummation of the merger, Clark became a wholly-owned
          subsidiary of the company.  The total purchase price for Clark
          was approximately $1.5 billion after taking into account amounts
          paid in respect of outstanding stock options and certain
          transactions.  The purchase price exceeded net assets acquired by
          approximately $1,120 million, which is being amortized on a
          straight-line basis over 40 years.  Included among the assets
          acquired by the company through the acquisition of Clark are the
          Melroe Company (Melroe), Blaw-Knox Construction Equipment
          Corporation (Blaw-Knox), Clark-Hurth Components Company (Clark-
          Hurth) and Club Car, Inc. (Club Car).  Melroe products consist of
          skid-steer loaders, compact excavators and a limited line of
          agricultural equipment.  Blaw-Knox is one of the leading
          producers of asphalt paving equipment in the world.  The products
          of the Clark-Hurth business consist of axles and transmissions
          for off-highway equipment.  Club Car produces golf cars and light
          utility vehicles.  The funds to consummate the acquisition came
          from borrowings of the company under a credit agreement, which
          has been converted into long-term debt with lower interest rates.
             The results of Clark's operations have been included in the
          consolidated financial statements from the acquisition date.  The
          following unaudited pro forma consolidated results of operations
          for the years ended December 31, 1995 and 1994, reflect the
          acquisition as though it occurred at the beginning of the
          respective periods after adjustments for the impact of interest
          on acquisition debt, depreciation and amortization of assets,
          including goodwill, to reflect the purchase price allocation, and
          the elimination of Clark's income from discontinued operations
          related to its disposition of its investments in VME Group N.V.
          and Clark Automotive Products Corporation (in millions except per
          share amounts):

                                                          (Unaudited)
          For the years ended December 31             1995           1994
             Sales                                $6,346.1       $5,689.5
             Net earnings                            283.5          198.7
             Earnings per share                      $2.67          $1.87







                                         149<PAGE>


                                                       EXHIBIT 13
                                                       Page 35 of 60


            It should be noted that the company's actual results for 1995
          (and the above pro forma amounts) were adversely affected by the
          loss on the sale of the company's domestic paving business, which
          was a preacquisition requirement to the Clark purchase.  The
          above pro forma results are not necessarily indicative of what
          the actual results would have been had the acquisition occurred
          at the beginning of the respective periods.  Further, the pro
          forma results are not intended to be a projection of future
          results of the combined companies.
            During 1994, the company made several acquisitions.  In April
          1994, the company acquired full ownership of the ball bearing
          joint venture with GMN Georg Mueller of America, Inc. for $4.9
          million in cash.  The company previously owned 50% of the joint
          venture.  The company acquired Montabert S.A., a French
          manufacturer of hydraulic rock-breaking and drilling equipment on
          June 30, 1994, for approximately $18.4 million, plus assumption
          of liabilities.  In August 1994, the company acquired the Ecoair
          air compressor product line from MAN Gutehoffnungshutte AG (MAN
          GHH) for $10.6 million in cash.  The company also entered into a
          50/50 joint venture, GHH-RAND Schraubenkompressoren GmbH & Co. KG
          (GHH-RAND) with MAN GHH to manufacture airends.  The company
          invested approximately $17.6 million in GHH-RAND.  The company
          also had several additional purchases of operations during the
          year totalling $3.9 million in cash.
            In 1993, the company acquired the Kunsebeck, Germany, needle
          and cylindrical bearing business of FAG Kugelfischer Georg
          Schafer AG of Schweinfurt, Germany, for $42.5 million in cash.  
            These transactions have been accounted for as purchases and
          accordingly, each purchase price was allocated to the acquired
          assets and assumed liabilities based on their estimated fair
          values.  The company has classified as intangible assets the
          costs in excess of the fair value of the net assets of companies
          acquired.  The results of all acquired operations have been
          included in the consolidated financial statements from their
          respective acquisition dates.


          NOTE 3 - DISPOSITIONS AND RESTRUCTURE OF OPERATIONS:  On May 15,
          1995, the company sold its domestic paving equipment business to
          Champion Road Machinery Limited of Canada.  The sale was a
          preacquisition requirement, in order to satisfy concerns of the
          United States Justice Department, prior to the Clark acquisition. 
          The company incurred a $7.1 million pretax loss associated with
          this sale.
            In 1994, the assets of the IDP Australian operations were sold
          in return for shares of the purchaser.  The company and Dresser
          Industries sold IRI International Corporation, a 50/50 joint
          venture that is a manufacturer of mobile drilling rigs, to a
          third party.



                                         150<PAGE>


                                                       EXHIBIT 13
                                                       Page 36 of 60


            The company sold the assets of several small business units in
          1993, as well as substantially all of the assets of its coal-
          mining machinery and aerospace bearings businesses for $55.5
          million in cash.  In connection with the sale of the company's
          underground coal-mining machinery assets to Long-Airdox Company,
          the company recorded a $5.0 million restructure of operations
          charge during the second quarter of 1993.  



          NOTE 4 - INVENTORIES:  At December 31, inventories were as
          follows:

          In millions                                  1995           1994
          Raw materials and supplies               $  211.8         $117.6
          Work-in-process                             326.1          293.0
          Finished goods                              538.5          429.7
                                                    1,076.4          840.3
          Less-LIFO reserve                           163.8          161.0
          Total                                    $  912.6         $679.3

             Work-in-process inventories are stated after deducting
          customer progress payments of $38.8 million in 1995 and $27.2
          million in 1994.  At December 31, 1995 and 1994, LIFO inventories
          comprised approximately 41 percent and 35 percent, respectively,
          of consolidated inventories.
             During the periods presented, certain inventory quantities
          were reduced, resulting in partial liquidations of LIFO layers. 
          This decreased cost of goods sold by $3.4 million in 1995, $11.6
          million in 1994 and $12.5 million in 1993.  These liquidations
          increased net earnings in 1995, 1994 and 1993 by approximately
          $2.1 million ($0.02 per share), $7.1 million ($0.07 per share)
          and $7.6 million ($0.07 per share), respectively.


          NOTE 5 - INVESTMENTS IN PARTIALLY-OWNED EQUITY COMPANIES:  The
          company has numerous investments, ranging from 20 percent to 50
          percent, in companies which operate in similar lines of business. 
             The company's investments in and amounts due from partially-
          owned equity companies amounted to $202.9 million and $20.4
          million, respectively, at December 31, 1995, and $170.5 million
          and $3.4 million, respectively, at December 31, 1994.
             The company's equity in the net earnings of its
          partially-owned equity companies was $26.2 million, $15.6 million
          and $15.6 million in 1995, 1994 and 1993, respectively.
             The company received dividends based on its equity interests
          in these companies of $6.7 million, $3.8 million and $3.1 million
          in 1995, 1994 and 1993, respectively.  




                                         151<PAGE>


                                                       EXHIBIT 13
                                                       Page 37 of 60


             Summarized financial information for these partially-owned
          equity companies at December 31, and for the years presented was:

          In millions                                  1995           1994
          Current assets                           $  467.6       $  388.6
          Property, plant and 
            equipment, net                            284.9          264.6
          Other assets                                 30.2           20.3
          Total assets                             $  782.7       $  673.5
          Current liabilities                      $  272.0       $  250.5
          Long-term debt                               56.5           50.2
          Other liabilities                            47.4           30.0
          Total shareowners' equity                   406.8          342.8
          Total liabilities
            and equity                             $  782.7       $  673.5

          In millions                   1995           1994           1993
          Net sales                 $  872.5       $  701.0       $  730.1
          Gross profit                 180.2          142.0          127.5
          Net earnings                  55.8           33.7           48.5


          NOTE 6 - DRESSER-RAND COMPANY:  Dresser-Rand Company is a
          partnership between Dresser Industries, Inc. (51 percent), and
          the company (49 percent) comprising the worldwide reciprocating
          compressor and turbomachinery businesses of the two companies. 
          The company's investment in Dresser-Rand is accounted for using
          the equity method of accounting.  
             Summarized financial information for Dresser-Rand at December
          31, and for the years presented was: 

          In millions                                  1995           1994
          Current assets                           $  457.2       $  440.5
          Property, plant and
            equipment, net                            239.3          197.8
          Other assets                                 27.2           18.5
          Total assets                                723.7          656.8

          Deduct:
          Current liabilities                         341.4          295.1
          Other liabilities                           200.8          188.9
                                                      542.2          484.0
          Net partners' equity
            and advances                           $  181.5       $  172.8

          In millions                    1995          1994           1993
          Net sales                  $1,081.4      $1,219.4       $1,187.3
          Gross profit                  212.5         203.1          241.9
          Net earnings                   44.9          50.2           68.1



                                         152<PAGE>


                                                       EXHIBIT 13
                                                       Page 38 of 60


             The company's investment in Dresser-Rand was $182.8 million
          and $160.8 million at December 31, 1995 and 1994, respectively. 
          The company owed Dresser-Rand $88.9 million at December 31, 1995,
          and $70.1 million at December 31, 1994.


          NOTE 7 - ACCOUNTS PAYABLE AND ACCRUALS:  Accounts payable and
          accruals at December 31, were:

          In millions                                  1995           1994
          Accounts payable                         $  337.5       $  255.6
          Accrued:
            Payrolls and benefits                     177.4          137.3
            Taxes                                      59.5           48.6
            Insurance and claims                      110.9           93.7
            Postemployment benefits                    98.5           74.0
            Warranties                                 52.3           36.8
            Interest                                   33.6           10.8
          Other accruals                              260.1          227.0
                                                   $1,129.8       $  883.8

          NOTE 8 - LONG-TERM DEBT AND CREDIT FACILITIES: 
          At December 31, long-term debt consisted of:

          In millions                                  1995           1994
          6 7/8% Notes Due 2003                    $  100.0         $100.0
          9% Debentures Due 2021                      125.0          125.0
          7.20% Debentures Due 2025                   150.0             --
          6.48% Debentures Due 2025                   150.0             --
          Medium Term Notes Due 1997-2004, at
             an average rate of 6.57%                 600.0             --
          9.75% Clark Debentures Due 2001             100.0             --
          Clark Medium Term Notes Due 1998-2023,
             at an average rate of 7.89%               60.2             --
          8 1/4% Notes Due 1996                          --           75.0
          Other domestic and foreign
             loans and notes, at end-
             of-year average interest
             rates of 6.53% in 1995
             and 6.99% in 1994, maturing
             in various amounts to 2025                19.2           15.9
                                                   $1,304.4         $315.9

             Debt retirements for the next five years are as follows: 
          $102.9 million in 1996, $135.1 million in 1997, $146.7 million in
          1998, $102.9 million in 1999 and $102.4 million in 2000.






                                         153<PAGE>


                                                       EXHIBIT 13
                                                       Page 39 of 60


             In June 1995, the company issued $150.0 million of debentures
          at 7.20% per annum, which are not redeemable prior to maturity in
          2025 and $150.0 million of debentures at 6.48% per annum due in
          2025 which may be repaid at the option of the holder on June 1,
          2005.  During July and August 1995, the company issued medium
          term notes totalling $600.0 million at an average rate of 6.57%
          with maturities ranging from 1997 to 2004.  The proceeds from
          these financings were used to refinance short-term borrowings
          related to the acquisition of Clark.
             At December 31, 1995, the company had two five-year committed
          revolving credit lines totalling $800.2 million, both of which
          were unused.  These lines provide support for commercial paper
          and indirectly provide support for other financial instruments,
          such as letters of credit and comfort letters, as required in the
          normal course of business.  The company compensates banks for
          these lines with fees equal to .08% per annum.  Available foreign
          lines of credit were $733.5 million, of which $676.0 million were
          unused at December 31, 1995.  No major cash balances were subject
          to withdrawal restrictions.  At December 31, 1995, the average
          rate of interest for loans payable, excluding the current portion
          of long-term debt, was 7.78% and related to foreign loans.
             Capitalized interest on construction and other capital
          projects amounted to $3.5 million, $3.2 million and $2.8 million
          in 1995, 1994 and 1993, respectively.  Interest income, included
          in Other income (expense), net, was $11.5 million, $11.5 million
          and $11.7 million in 1995, 1994 and 1993, respectively.


          NOTE 9 - FINANCIAL INSTRUMENTS:  The company, as a large
          multinational company, maintains significant operations in
          foreign countries.  As a result of these global operating and
          financing activities, the company is exposed to changes in
          foreign currency exchange rates, which affect the results of
          operations and financial condition.  The company manages exposure
          to changes in foreign currency exchange rates through its normal
          operating and financing activities, as well as through the use of
          financial instruments.  Generally, the only financial instruments
          the company utilizes are forward exchange contracts.  
             The purpose of the company's hedging activities is to mitigate
          the impact of changes in foreign exchange rates.  The company
          attempts to hedge transaction exposures through natural offsets. 
          To the extent this is not practicable, major exposure areas which
          are considered for hedging include, foreign currency denominated
          receivables and payables, intercompany loans, firm committed
          transactions, anticipated sales and purchases and dividends
          relating to foreign subsidiaries.  The following table summarizes
          by major currency the contractual amounts of the company's
          forward contracts in U.S. dollars.  Foreign currency amounts are 




                                         154<PAGE>


                                                       EXHIBIT 13
                                                       Page 40 of 60


          translated at year-end rates at the respective reporting date. 
          The "buy" amounts represent the U.S. equivalent of commitments to
          purchase foreign currencies, and the "sell" amounts represent the
          U.S. equivalent of commitments to sell foreign currencies.  Some
          of the forward contracts involve the exchange of two foreign
          currencies according to local needs in foreign subsidiaries.  At
          December 31, the contractual amounts were:

          In millions                      1995                 1994     
                                       Buy      Sell        Buy      Sell
          Austrian schilling        $  9.6    $  1.6     $  3.5    $   .3
          Belgian francs               3.2       8.3         .3       1.4
          Canadian dollars            10.4       6.6        2.4      13.3
          Deutsche marks              10.2     135.6        8.4      81.8
          Dutch guilders              20.2       7.8         --       1.3
          French francs               24.1      38.5        3.3      10.6
          Italian lira                41.1       6.9       34.9       2.3
          Japanese yen                19.0       2.0        3.4      19.2
          Pounds sterling             25.1     128.8       59.1      55.5
          South African rand           3.5      12.8        6.6      14.4
          Other                        6.5       7.5        8.5      13.4
            Total                   $172.9    $356.5     $130.4    $213.5

             Forward contracts for normal operating activities have
          maturities of one to 12 months; and forward contracts for
          intercompany loans have maturities that range from one month to
          36 months.
             The company's forward contracts do not subject the company to
          risk due to foreign exchange rate movement, since gains and
          losses on these contracts generally offset losses and gains on
          the assets, liabilities or other transactions being hedged. 
             The counterparties to the company's forward contracts consist
          of a number of major international financial institutions.  The
          credit ratings and concentration of risk of these financial
          institutions are monitored on a continuing basis and present no
          significant credit risk to the company.   
             The carrying value of cash and cash equivalents, marketable
          securities (classified as held to maturity), accounts receivable,
          short-term borrowings and accounts payable are a reasonable
          estimate of their fair value due to the short-term nature of
          these instruments.  The following table summarizes the estimated
          fair value of the company's remaining financial instruments at
          December 31:






                                         155<PAGE>


                                                       EXHIBIT 13
                                                       Page 41 of 60


          In millions                              1995              1994
          Long-term debt: 
          Carrying value                       $1,304.4            $315.9
          Estimated fair value                  1,410.6             312.5

          Forward contracts:
          Contract (notional) amounts:
            Buy contracts                      $  172.9            $130.4
            Sell contracts                        356.5             213.5
          Fair (market) values:
            Buy contracts                         172.9             131.2
            Sell contracts                        356.8             211.9

             Fair value of long-term debt was determined by reference to
          the December 31, 1995 and 1994, market values of comparably rated
          debt instruments.  Fair values of forward contracts are based on
          dealer quotes at the respective reporting dates.


          NOTE 10 - COMMITMENTS AND CONTINGENCIES:  The company is involved
          in various litigations, claims and administrative proceedings,
          including environmental matters, arising in the normal course of
          business.  In assessing its potential environmental liability,
          the company bases its estimates on current technologies and does
          not discount its liability or assume any insurance recoveries. 
          Amounts recorded for identified contingent liabilities are
          estimates, which are reviewed periodically and adjusted to
          reflect additional information when it becomes available. 
          Subject to the uncertainties inherent in estimating future costs
          for contingent liabilities, management believes that recovery or
          liability with respect to these matters would not have a material
          effect on the financial condition, results of operations,
          liquidity or cash flows of the company for any year.
             In the normal course of business, the company has issued
          several direct and indirect guarantees, including performance
          letters of credit, totalling approximately $115 million at
          December 31, 1995.  The company has also guaranteed the residual
          value of leased Club Car vehicles in the aggregate amount of
          $20.7 million.  Management believes these guarantees will not
          adversely affect the consolidated financial statements.





                                         156<PAGE>


                                                       EXHIBIT 13
                                                       Page 42 of 60


             As a result of the Clark acquisition, the company is involved
          in certain repurchase arrangements relating to product
          distribution and product financing activities.  As of December
          31, 1995, repurchase arrangements relating to product financing
          by an independent finance company approximated $101.6 million. 
          It is not practicable to determine the additional amount subject
          to repurchase solely under dealer distribution agreements.  Under
          the repurchase arrangements relating to product-distribution and
          product-financing activities, when dealer terminations do occur,
          a newly selected dealer generally acquires the assets of the
          prior dealer and assumes any related financial obligation. 
          Accordingly, the risk of loss to the company is minimal.
          Historically, Clark incurred only immaterial losses relating to
          these arrangements.
             Clark sold Clark Material Handling Company (CMHC), its
          forklift truck business, to Terex Corporation (Terex) in 1992. 
          As part of the sale, Terex and CMHC assumed substantially all of
          the obligations for existing and future product liability claims
          involving CMHC products.  In the event that Terex and CMHC fail
          to perform or are unable to discharge any of the assumed
          obligations, the company could be required to discharge such
          obligations.  While the aggregate losses associated with these
          obligations could be significant, the company does not believe
          they would materially affect the financial condition, the results
          of operations, liquidity or cash flows of the company in any one
          year.
             In 1995, the company continued to sell an undivided interest
          in designated pools of accounts and notes receivable up to a
          maximum of $150.0 million.  Similar agreements have been in
          effect since 1987.  During 1995, 1994 and 1993, such sales
          amounted to $533.7 million, $487.8 million and $518.7 million,
          respectively.  At December 31, 1995 and 1994, $150.0 million and
          $125.0 million, respectively, of such sold receivables remained
          uncollected.  The undivided interest in the designated pool of
          receivables was sold with limited recourse.  These agreements
          expire in one- and two-year periods based on the particular pool
          of receivables sold.  The company intends to renew these
          agreements at their expiration dates with either the current
          financial institution, or another financial institution, using
          the basic terms and conditions of the existing agreements.  For
          receivables sold, the company has retained collection and
          administrative responsibilities as agent for the purchaser.
             Receivables, excluding the designated pools of accounts and
          notes receivable, sold during 1995, 1994 and 1993 with recourse,
          amounted to $175.9 million, $64.6 million and $39.3 million,
          respectively.  At December 31, 1995 and 1994, $35.3 million and
          $14.7 million, respectively, of such receivables sold remained
          uncollected.




                                         157<PAGE>


                                                       EXHIBIT 13
                                                       Page 43 of 60


             As of December 31, 1995, the company had no significant
          concentrations of credit risk in trade receivables due to the
          large number of customers which comprise its receivables base and
          their dispersion across different industries and countries.
             Certain office and warehouse facilities, transportation
          vehicles and data processing equipment are leased.  Total rental
          expense was $64.7 million in 1995, $56.2 million in 1994 and
          $57.9 million in 1993.  Minimum lease payments required under
          noncancellable operating leases with terms in excess of one year
          for the next five years and thereafter, are as follows: $38.7
          million in 1996, $27.5 million in 1997, $16.7 million in 1998,
          $9.0 million in 1999, $6.7 million in 2000 and $17.2 million
          thereafter.                                          


          NOTE 11 - COMMON STOCK:  On December 7, 1988, the board of
          directors adopted a Rights Plan (Plan) and declared a dividend
          distribution of one right for each then outstanding share of the
          company's common stock.  As a result of the two-for-one stock
          split in 1992, each current outstanding share of the company's
          common stock has one-half a right associated with it.  In
          December 1994, the Plan was amended by the board of directors. 
          Under the Plan as amended, each right entitles the holder to
          purchase 1/100th of a share of Series A preference stock at an
          exercise price of $130.  The company has reserved 563,000 shares
          of Series A preference stock for issuance upon exercise of the
          rights.  The rights become exercisable in accordance with the
          provisions of the Plan on (i) the tenth day following the
          acquisition by a person or group of persons of 15 percent or more
          of the company's common stock, (ii) the tenth day after the
          commencement of a tender or exchange offer for 15 percent or more
          of the company's common stock, or (iii) the determination by the
          board of directors that a person is an Adverse Person as defined
          in the Plan (Distribution Date).  Upon either a person's becoming
          an Acquiring Person as defined in the Plan, or the board's
          determination that a person is an Adverse Person, or the
          occurrence of certain other events following the Distribution
          Date, each holder of a right shall thereafter have a right to
          receive the common stock of the company (or in certain
          circumstances, the stock of an acquiring entity) for a price of
          approximately half its value.  The rights are not exercisable by
          any Acquiring Person or Adverse Person.  The Plan as amended
          provides that the board of directors, at its option any time
          after any person becomes an Acquiring Person or an Adverse
          Person, may exchange all or part of the outstanding and
          exercisable rights for shares of common stock, currently at an
          exchange ratio of one right for two shares.  The right of the
          holders to exercise the rights to purchase shares automatically 




                                         158<PAGE>


                                                       EXHIBIT 13
                                                       Page 44 of 60


          terminates if the board orders an exchange of rights for shares. 
          The rights may be redeemed by the company for one cent per right
          in accordance with the provisions of the Plan.  The rights will
          expire on December 22, 1998, unless redeemed earlier by the
          company.
             Shares held in treasury at December 31, 1995, will be used for
          employee benefit plans and for other corporate purposes.  


          NOTE 12 - LEVERAGED EMPLOYEE STOCK OWNERSHIP PLAN:  At the time
          of its acquisition by the company, Clark sponsored a Leveraged
          Employee Stock Ownership Plan (LESOP) for eligible employees.  In
          connection with the acquisition, the company purchased the
          LESOP's shares for $176.6 million.  The company determined it
          would continue the LESOP to fund certain employee benefit plans. 
          Accordingly, on September 28, 1995, the company sold 2,878,008
          shares of its Common Stock held in treasury to the LESOP, for a
          price of $36.25 per share (the closing price of the Common Stock
          on September 27, 1995, on the New York Stock Exchange) or an
          aggregate of $104.3 million.  At December 31, 1995, approximately
          1.9 million of these shares remain unallocated and the $70.2
          million paid by the LESOP for those unallocated shares is
          classified as a reduction of shareowners' equity pending
          allocation to participants.  At December 31, 1995, the LESOP owed
          the company $36.8 million repayable in monthly installments
          through 2001.  Company contributions to the LESOP and dividends
          on unallocated shares are used to make loan principal and
          interest payments.  With each principal and interest payment, the
          LESOP allocates a portion of the Common Stock to participating
          employees. 


          NOTE 13 - INCENTIVE STOCK PLANS:  Under the company's Incentive
          Stock Plans, key employees have been granted options to purchase
          common shares at prices not less than the fair market value at
          the date of grant.  The plans, approved in 1985, 1990 and 1995,
          also authorize stock appreciation rights (SARs) and stock awards. 
          If SARs issued in conjunction with stock options are exercised,
          the related stock options are cancelled; conversely, the exercise
          of stock options cancels the SARs.  
            Changes during the year in options outstanding under the plans
          were as follows:
                                                                   
                                         Shares subject       Option price
                                              to option    range per share
          January 1, 1995                     3,384,300       $10.04-37.19
          Granted                               988,900        34.75-40.06
          Exercised                             749,800        10.04-34.94
          Cancelled                              21,000              34.94
          December 31, 1995                   3,602,400       $11.95-40.06


                                         159<PAGE>


                                                       EXHIBIT 13
                                                       Page 45 of 60


             Of the shares subject to option, 1,988,250 were granted with
          SARs.  There are also 192,500 SARs outstanding with no stock
          options.  At December 31, 1995, options for 2,628,500 shares were
          exercisable and 5,513,210 shares were available for future
          awards.  In addition, at December 31, 1995, 268,690 shares of
          common stock were reserved for future issue, contingent upon
          attainment of certain performance goals and future service.  
             The company also maintains a shareowner-approved Management
          Incentive Unit Award Plan.  Under the plan, qualifying executives
          are awarded incentive units.  When dividends are paid on common
          stock, dividends are awarded to unit holders, one-half of which
          is paid in cash, the remaining half of which is credited to the
          participant's account in the form of so-called common stock
          equivalents.  The fair value of accumulated common stock
          equivalents is paid in cash upon the participant's retirement. 
          The number of common stock equivalents credited to participant's
          accounts at December 31, 1995 and 1994, are 288,837 and 284,409,
          respectively.


          NOTE 14 - INCOME TAXES:  Earnings before income taxes and the
          effect of accounting changes for the years ended December 31,
          were taxed within the following jurisdictions:

          In millions               1995             1994           1993
          United States           $308.0           $279.4         $229.5
          Foreign                  121.1             50.5           24.0
          Total                   $429.1           $329.9         $253.5

             The provision for income taxes before the effect of the
          accounting change was as follows:

          In millions               1995             1994           1993
          Current tax expense:
            United States         $101.3           $ 69.8         $ 74.9
            Foreign                 42.7             34.8           30.6
            Total current          139.7            104.6          105.5
          Deferred tax expense:
            United States           10.6             30.3            5.3
            Foreign                  4.2            (16.1)         (20.8)
            Total deferred          14.8             14.2          (15.5)
            Total provision for
              income taxes        $158.8           $118.8         $ 90.0









                                         160<PAGE>


                                                       EXHIBIT 13
                                                       Page 46 of 60


             The provision for income taxes differs from the amount of
          income taxes determined by applying the applicable U.S. statutory
          income tax rate to pretax income before the effect of the
          accounting change, as a result of the following differences:

                                                  Percent of pretax income
                                               1995       1994       1993 
          Statutory U.S. rates                 35.0%      35.0%      35.0%
          Increase (decrease) in rates 
            resulting from:
            Foreign operations                  1.0        0.3        0.6
            Effect of changes in statutory 
              rate on deferred taxes             --         --       (2.2)
            Earnings/losses of equity
              companies                        (1.8)      (0.9)      (2.2)
            State and local income taxes,
              net of U.S. tax                   1.3        1.6        1.3 
            Other                               1.5         --        3.0 
          Effective tax rates                  37.0%      36.0%      35.5%




                                         161<PAGE>


                                                       EXHIBIT 13
                                                       Page 47 of 60

<TABLE>
            A summary of the deferred tax accounts at December 31, follows:

          In millions                                      1995       1994       1993
          Current deferred assets and (liabilities):
            Differences between book and tax bases
            <S>                                          <C>        <C>        <C>
              of inventories and receivables             $ 30.8     $ 36.5     $ 32.6
            Differences between book and tax
              expense for other employee related
              benefits and allowances                      35.3       33.9       42.1
            Provisions for restructure of
              operations and plant closings
              not yet deductible for tax purposes           9.4        6.4        5.3
            Other reserves and valuation
              allowances in excess of tax deductions       53.1       32.5       28.0
            Other differences between tax and 
              financial statement values                  (10.1)       9.9        8.9
              Gross current deferred net tax assets       118.5      119.2      116.9
          Noncurrent deferred tax assets and
            (liabilities):
            Tax items associated with equity
              companies                                    11.1       13.0       31.0
            Postretirement and postemployment
              benefits other than pensions in
              excess of tax deductions                    252.5      159.9      159.9
            Other reserves in excess of tax expense        65.0       36.3       28.1
            Tax depreciation in excess of book
              depreciation                                (85.5)     (46.0)     (54.8)
            Pension contributions in excess of
              book expense                                (51.2)     (47.5)     (36.6)
            Taxes provided for unrepatriated
              foreign earnings                            (28.5)     (20.1)     (26.3)
              Gross noncurrent deferred net tax assets    163.4       95.6      101.3
              Less:  deferred tax valuation allowances    (28.6)     (21.2)     (10.4)
                Total net deferred tax assets            $253.3     $193.6     $207.8
</TABLE>


                                                      162<PAGE>


                                                       EXHIBIT 13
                                                       Page 48 of 60


            A total of $28.5 million of deferred taxes have been provided
          for a portion of the undistributed earnings of subsidiaries
          operating outside of the United States.  As to the remainder,
          these earnings have been, and under current plans will continue
          to be reinvested and it is not practicable to estimate the amount
          of additional taxes which may be payable upon repatriation.


          NOTE 15 - BUSINESS SEGMENT INFORMATION:  A description of
          business segments and operations by business segment and
          geographic area for the three years ended December 31, 1995, were
          as follows:

          DESCRIPTION OF BUSINESS SEGMENTS
          Ingersoll-Rand's operations are organized into three worldwide
          business segments:  Standard Machinery; Engineered Equipment; and
          Bearings, Locks and Tools.

          Standard Machinery
          The segment's products are categorized into five groups:

          Air Compressor - products include portable, reciprocating, rotary
          and centrifugal air compressors, vacuum pumps, air drying and
          filtering systems and other compressor accessories.  The products
          are used primarily to supply pressurized air to industrial
          plants, refineries, chemical plants, electrical utilities and
          service stations.

          Construction and Mining - manufactures vibratory compactors,
          asphalt pavers, rock drills, blasthole drills, water-well drills,
          crawler drills, jumbo drills, jackhammers and rock and roof
          stabilizers primarily for the construction, highway maintenance,
          metals-mining and well-drilling industries.

          Melroe - manufactures skid-steer loaders, compact hydraulic
          excavators and self-propelled agricultural sprayers.  The
          products are used primarily by the construction and agricultural
          industries.

          Club Car - manufactures golf cars and utility vehicles which are
          used primarily in the golf and resort industries.

          Mining Machinery(1) - products included continuous and long-wall
          mining machines, crushers, coal haulers and mine-service
          vehicles, which principally serve the underground coal-mining
          industry.






                                         163<PAGE>


                                                       EXHIBIT 13
                                                       Page 49 of 60


          Engineered Equipment
          The segment's products are categorized into three groups:

          Pump - manufactures centrifugal and reciprocating pumps.  These
          products serve oil production and refining, chemical process,
          marine, agricultural, electric utility and general manufacturing
          industries.

          Process Systems - consists of pulp and paper processing
          equipment, pelleting equipment, filters, aerators and dewatering
          systems.  This equipment is used in the pulp and paper, food and
          agricultural, and minerals-processing industries.

          Clark-Hurth - manufactures a broad line of axles and
          transmissions for the off-highway vehicle industry.

          Bearings, Locks and Tools
          The segment's products are categorized into three groups:

          Bearings and Components - principal products include needle
          bearings, needle roller bearings, needle rollers, thrust
          bearings, tapered roller bearings, drawn cup bearings,
          high-precision ball bearings, spherical bearings, radial
          bearings, universal joints, dowel pins, swagers and precision
          components. These products are sold principally to durables-
          industry customers primarily in the automotive and aerospace
          markets.

          Production Equipment - manufactures air-powered tools, hoists and
          winches, air motors and air starters, automated assembly and test
          systems, air and electric automated fastener tightening systems
          and waterjet cutting systems.  These products are sold to general
          manufacturing industries and to the appliance, aircraft,
          construction and automotive industries.

          Architectural Hardware(2) - major products include locks, door
          closers and exit devices used in commercial and residential
          construction and the retail hardware market.



          (1)
             The Mining Machinery Group was sold during 1993 .
          (2)
             Prior to January 1, 1996, the Door Hardware Group.







                                         164<PAGE>
                                                       EXHIBIT 13
                                                       Page 50 of 60

<TABLE>
    Operations by Business Segments                                                          
    Dollar amounts in millions
    For the years ended                         % of                % of                 % of
    December 31                         1995   total        1994   total         1993   total
    Standard Machinery
    <S>                             <C>          <C>    <C>          <C>     <C>          <C>
    Sales                           $2,270.6     40%    $1,445.7     32%     $1,250.9     31%
    Operating income excluding
      restructure of operations        222.6     41%       122.4     30%         89.6     27%
    Restructure of operations
      (charge) benefit                  --                  --                   (5.0)
    Operating income from
      operations                       222.6     41%       122.4     30%         84.6     26%
    Operating income as % of sales       9.8%                8.5%                 6.8%
    Identifiable assets              2,528.0             1,099.6                927.1
    Depreciation and amortization       62.7                31.5                 27.0
    Capital expenditures                56.7                30.9                 25.0

    Engineered Equipment
    Sales                            1,216.2     21%       926.4     21%        929.6     23%
    Operating income excluding
      restructure of operations         49.5      9%        35.3      8%         30.5      9%
    Restructure of operations
      (charge) benefit                  --                  --                   --
    Operating income from
      operations                        49.5      9%        35.3      8%         30.5     9%
    Operating income as % of sales       4.1%                3.8%                 3.3%
    Identifiable assets              1,061.8               634.5                622.3
    Depreciation and amortization       40.0                28.8                 29.3
    Capital expenditures                42.3                30.3                 29.0

    Bearings, Locks and Tools
    Sales                            2,242.2     39%     2,135.4     47%      1,840.6    46%
    Operating income excluding
      restructure of operations        269.1     50%       256.6     62%        210.7    64%
    Restructure of operations
      (charge) benefit                  --                  --                   --
    Operating income from
      operations                       269.1     50%       256.6     62%        210.7    65%
    Operating income as % of sales      12.0%               12.0%                11.4%
    Identifiable assets              1,208.1             1,185.1              1,102.7
    Depreciation and amortization       75.0                70.9                 65.5
    Capital expenditures               107.9                97.0                 77.8
                                                      165<PAGE>

                                                       EXHIBIT 13
                                                       Page 51 of 60


    Operations by Business Segments (continued)                                              

    Dollar amounts in millions
    For the years ended                         % of                % of                 % of
    December 31                         1995   total        1994   total         1993   total

    Total
    Sales                            5,729.0    100%     4,507.5    100%      4,021.1    100%
    Operating income excluding
      restructure of operations        541.2    100%       414.3    100%        330.8    100%
    Restructure of operations
      (charge) benefit                  --                  --                   (5.0)
    Operating income from
      operations                       541.2    100%       414.3    100%        325.8    100%
    Operating income as % of sales       9.4%                9.2%                 8.1%
    Identifiable assets              4,797.9             2,919.2              2,652.1
    Depreciation and amortization      177.7               131.2                121.8
    Capital expenditures               206.9               158.2                131.8
    General corporate expenses
      charged to operating income      (44.2)              (37.3)               (34.3)
    Operating income                   497.0               377.0                291.5

    Unallocated
    Interest expense                   (86.6)              (43.8)               (52.0)
    Other income (expense), net          9.4               (14.7)                (7.5)
    Dresser-Rand income                 22.0                24.6                 33.1
    Ingersoll-Dresser Pump
      minority interest                (12.7)              (13.2)               (11.6)
    Earnings before income taxes
      and effect of accounting
      changes                          429.1               329.9                253.5
    Corporate assets (b)               765.4               677.7                723.2

    Total assets                    $5,563.3            $3,596.9             $3,375.3

    (b) Corporate assets consist primarily of cash and cash equivalents, marketable securities,
    investments and advances, and other assets not directly associated with the operations of a
    business segment.  
</TABLE>



                                                      166<PAGE>


                                                       EXHIBIT 13
                                                       Page 52 of 60

<TABLE>
  Operations by Geographic Area                                                                       
  In millions
                                   United                        Other     Adjustments/
  For the year 1995                States      Europe    International     Eliminations   Consolidated

  <S>                            <C>         <C>                <C>            <C>            <C>
  Sales to customers             $3,472.8    $1,754.0           $502.2         $    --        $5,729.0
  Transfers between geographic
    areas                           568.5        60.9             42.5          (671.9)             --
  Total sales and transfers      $4,041.3     1,814.9            544.7          (671.9)       $5,729.0
  Operating income from
    operations                   $  391.5        97.5             51.7              .5        $  541.2
  General corporate expenses
    charged to operating income                                                                  (44.2)
  Operating income                                                                            $  497.0
  Identifiable assets at
    December 31, 1995            $3,183.9     1,305.3            319.8           (11.1)       $4,797.9
  Corporate assets                                                                               765.4
  Total assets at
    December 31, 1995                                                                         $5,563.3


  For the year 1994

  Sales to customers             $2,809.9     1,253.9            443.7              --        $4,507.5
  Transfers between geographic
    areas                           429.7        54.7             34.1          (518.5)             --
  Total sales and transfers      $3,239.6     1,308.6            477.8          (518.5)       $4,507.5
  Operating income from
    operations                   $  335.8        43.2             34.5              .8        $  414.3
  General corporate expenses
    charged to operating income                                                                  (37.3)
  Operating income                                                                            $  377.0
  Identifiable assets at
    December 31, 1994            $1,684.3       949.0            297.5           (11.6)       $2,919.2
  Corporate assets                                                                               677.7
  Total assets at
    December 31, 1994                                                                         $3,596.9




                                                     167<PAGE>


                                                       EXHIBIT 13
                                                       Page 53 of 60


  Operations by Geographic Area  (Continued)                                                          

                                   United                        Other     Adjustments/
  For the year 1993                States      Europe    International     Eliminations   Consolidated

  Sales to customers             $2,526.9     1,071.5            422.7              --        $4,021.1
  Transfers between geographic
    areas                           357.3        53.0             33.0          (443.3)             --
  Total sales and transfers      $2,884.2     1,124.5            455.7          (443.3)       $4,021.1
  Operating income excluding
    restructure of operations    $  260.0        35.5             34.7              .6        $  330.8
  Restructure of operations- 
    charge                           (5.0)         --               --              --            (5.0)
  Operating income from
    operations                   $  255.0        35.5             34.7              .6        $  325.8
  General corporate expenses
    charged to operating income                                                                  (34.3)
  Operating income                                                                            $  291.5
  Identifiable assets at
    December 31, 1993            $1,597.3       780.5            286.7           (12.4)       $2,652.1
  Corporate assets                                                                               723.2
  Total assets at
    December 31, 1993                                                                         $3,375.3



  International sales of U.S. manufactured products in millions were $1,028.9 in 1995, $743.3 in 1994, and
  $580.7 in 1993.
</TABLE>




                                                     168<PAGE>


                                                       EXHIBIT 13
                                                       Page 54 of 60



          NOTE 16 - PENSION PLANS:  The company has noncontributory pension
          plans covering substantially all domestic employees.  In
          addition, certain employees in other countries are covered by
          pension plans.  The company's domestic salaried plans principally
          provide benefits based on a career average earnings formula.  The
          company's hourly pension plans provide benefits under flat
          benefit formulas.  Foreign plans provide benefits based on
          earnings and years of service.  Most of the foreign plans require
          employee contributions based on the employee's earnings.  In
          addition, the company maintains other supplemental benefit plans
          for officers and other key employees.  The company's policy is to
          fund an amount which could be in excess of the pension cost
          expensed, subject to the limitations imposed by current statutes
          or tax regulations.  Clark's costs for the seven months ended
          December 31, 1995, and the status of its benefit plans at
          December 31, 1995, have been consolidated.
            The components of the company's pension cost for the years
          ended December 31, include the following:

          In millions                         1995        1994        1993
          Benefits earned during the
            year                           $  32.7      $ 31.7     $  27.7
          Interest cost on projected
            benefit obligation                99.7        79.1        72.1
          Actual return on plan assets      (261.2)        6.3      (124.4)
          Net amortization and deferral      157.7       (99.6)       32.7
            Net pension cost               $  28.9      $ 17.5     $   8.1





                                         169<PAGE>


                                                       EXHIBIT 13
                                                       Page 55 of 60
<TABLE>

            The status of employee pension benefit plans at December 31, 1995 and 1994, was as
          follows:

                                                        1995                          1994          
                                              Overfunded    Underfunded     Overfunded   Underfunded
          In millions                              plans          plans          plans         plans
          Actuarial present value of
            projected benefit obligation,
            based on employment service to
            date and current salary levels:
          <S>                                 <C>              <C>           <C>             <C>
            Vested employees                  $(1,101.2)       $(310.3)      $ (942.5)       $(48.4)
            Nonvested employees                   (23.5)         (13.8)          (5.3)         (6.0)
            Accumulated benefit obligation     (1,124.7)        (324.1)        (947.8)        (54.4)
            Additional amount related to
              projected salary increases          (49.9)         (26.4)         (48.8)        (20.6)
          Total projected benefit obligation   (1,174.6)        (350.5)        (996.6)        (75.0)
          Funded assets at fair value           1,331.7          207.5        1,053.9          12.4
          Assets in excess of (less than)
            projected benefit obligation          157.1         (143.0)          57.3         (62.6)
          Unamortized (net asset) liability
            existing at date of adoption           (2.5)          19.0           (3.5)          4.5
          Unrecognized prior service cost          18.6           11.5           16.6           9.5
          Unrecognized net (gain) loss            (23.2)          (3.4)          41.2           (.5)
          Adjustment required to recognize
            minimum liability                        --          (16.4)            --          (1.0)
          Prepaid (accrued) pension cost      $   150.0        $(132.3)      $  111.6        $(50.1)

            Plan investment assets of domestic plans are balanced between equity securities and cash
          equivalents or debt securities.  Assets of foreign plans are invested principally in
          equity securities.
            The present value of benefit obligations for domestic plans at December 31, 1995 and
          1994, was determined using an assumed discount rate of 7.25% and 8.0%, an assumed rate of
          increase in future compensation levels of 4.75% and 5.5%, and an expected long-term rate
          of return on assets of 9.0% and 8.5%, respectively.  The weighted averages of the
          actuarially assumed discount rate, long-term rate of return on assets and the rate for
          compensation increases for foreign plans were 8.5%, 9.0% and 6.5% in 1995, and 9.0%, 9.0%
          and 6.5% in 1994, respectively.
</TABLE>
                                                      170<PAGE>


                                                       EXHIBIT 13
                                                       Page 56 of 60



             Most of the company's domestic employees are covered by
          savings and other defined contribution plans.  Employer
          contributions and costs are determined based on criteria specific
          to the individual plans and amounted to approximately $24.9
          million, $21.7 million and $20.5 million in 1995, 1994 and 1993,
          respectively.  
             The company's costs relating to foreign defined contribution
          plans, insured plans and other foreign benefit plans were 
          $4.8 million, $4.3 million and $0.3 million in 1995, 1994 and
          1993, respectively.  
             In 1995, 1994 and 1993, the number of employees covered by
          multiemployer pension plans, was 210, 217 and 214, respectively. 
          The amounts charged to pension cost and contributed to
          multiemployer plans was $0.5 million in 1995, 1994 and 1993,
          respectively.
             The existing pension rules require the recognition of a
          liability in the amount that the company's unfunded accumulated
          benefit obligation exceeds the accrued pension cost, with an
          equal amount recognized as an intangible asset.  As a result, the
          company recorded in 1995 a noncurrent liability of $16.2 million
          and a current liability of $0.2 million, and a noncurrent
          liability of $1.0 million in 1994.   Offsetting intangible assets
          were recorded in the Consolidated Balance Sheets.


          NOTE 17 - POSTRETIREMENT BENEFITS OTHER THAN PENSIONS:  In
          addition to providing pension benefits, the company sponsors
          several postretirement plans that cover most domestic employees. 
          These plans provide for health care benefits and in some
          instances, life insurance benefits.  Postretirement health plans
          are contributory and are adjusted annually.  Life insurance plans
          are noncontributory.  When full-time employees retire from the
          company between age 55 and age 65, most are eligible to receive,
          at a cost to the retiree, certain health care benefits identical
          to those available to active employees.  After attaining age 65,
          an eligible retiree's health care benefit coverage becomes
          coordinated with Medicare.  Clark's costs for the seven months
          ended December 31, 1995, and the status of its postretirement
          plans at December 31, 1995, have been consolidated.  The company
          funds the benefit costs principally on a pay-as-you-go basis.  








                                         171<PAGE>


                                                       EXHIBIT 13
                                                       Page 57 of 60


             Summary information on the company's plans at December 31, was
          as follows:

          In millions                                    1995         1994
          Financial status of plans:
          Accumulated postretirement benefits
             obligation (APBO):
             Retirees                                 $(462.9)     $(251.3)
             Active employees                          (150.0)      (120.2)
                                                       (612.9)      (371.5)
          Plan assets at fair value                        --           --
          Unfunded accumulated benefits
            obligation in excess of plan assets        (612.9)      (371.5)
          Unrecognized net gain                          (9.9)        (9.7)
          Unrecognized prior service benefits           (84.8)       (90.0)
          Accrued postretirement benefits cost        $(707.6)     $(471.2)

             The components of net periodic postretirement benefits cost
          for the years ended December 31, were as follows:

          In millions                                1995     1994    1993
          Service cost, benefits attributed to
            employee service during the year        $ 5.2    $ 8.5   $ 5.7
          Interest cost on accumulated
            postretirement benefit obligation        37.6     26.9    28.3
          Net amortization and deferral              (5.6)    (5.2)   (5.1)
          Net periodic postretirement benefits cost $37.2    $30.2   $28.9

             The 1994 service cost of net periodic postretirement benefits
          cost includes a settlement charge of $3.2 million relating to
          retired employees from a closed facility.  The discount rates
          used in determining the APBO were 7.25% and 8.0% at December 31,
          1995 and 1994, respectively.  The assumed health care cost trend
          rates used in measuring the accumulated postretirement benefits
          obligation were 10.35% in 1995 and 12.4% in 1994, respectively,
          declining each year to an ultimate rate by 2003 of 4.75% in 1995
          and 5.5% in 1994.
             Increasing the health care cost trend rate by 1.0% as of
          December 31, 1995, would increase the APBO by 10%.  The effect of
          this change on the sum of the service cost and interest cost
          components of net periodic postretirement benefits cost for 1995
          would be an increase of 13%.  In 1993, the company made several
          modifications to the cost-sharing provisions of the
          postretirement plans.






                                         172<PAGE>


                                                       EXHIBIT 13
                                                       Page 58 of 60


          NOTE 18 - SUBSEQUENT EVENTS:  On January 29, 1996, the company
          signed a letter of intent to sell the assets of the Pulp
          Machinery Division to Harnischfeger Industries, Inc.  The sales
          price is in excess of the book value of the assets and the sale
          is subject to the execution of a definitive purchase agreement
          and the approval by regulatory authorities.
             In addition, on January 31, 1996, the company acquired the
          Steelcraft Division of MascoTech, Inc.  Steelcraft manufactures a
          wide range of cold-rolled and galvanized steel doors for use
          primarily in nonresidential construction.








                                         173<PAGE>


                                                       EXHIBIT 13
                                                       Page 59 of 60


          Report of Management                                              

               The accompanying consolidated financial statements have been
          prepared by the company.  They conform with generally accepted
          accounting principles and reflect judgments and estimates as to
          the expected effects of incomplete transactions and events being
          accounted for currently.  The company believes that the
          accounting systems and related controls that it maintains are
          sufficient to provide reasonable assurance that assets are
          safeguarded, transactions are appropriately authorized and
          recorded, and the financial records are reliable for preparing
          such financial statements.  The concept of reasonable assurance
          is based on the recognition that the cost of a system of internal
          accounting controls must be related to the benefits derived.  The
          company maintains an internal audit function that is responsible
          for evaluating the adequacy and application of financial and
          operating controls and for testing compliance with company
          policies and procedures.
               The Audit Committee of the board of directors is comprised
          entirely of individuals who are not employees of the company. 
          This committee meets periodically with the independent
          accountants, the internal auditors and management to consider
          audit results and to discuss significant internal accounting
          controls, auditing and financial reporting matters.  The Audit
          Committee recommends the selection of the independent
          accountants, who are then appointed by the board of directors,
          subject to ratification by the shareowners.
               The independent accountants are engaged to perform an audit
          of the consolidated financial statements in accordance with
          generally accepted auditing standards.  Their report follows.


          /S/ Thomas F. McBride
          Thomas F. McBride
          Senior Vice President and
          Chief Financial Officer






                                         174<PAGE>


                                                       EXHIBIT 13
                                                       Page 60 of 60


          Report of Independent Accountants                                


          February 6, 1996

          To the Board of Directors and
          Shareowners of Ingersoll-Rand Company:


               In our opinion, the accompanying consolidated balance sheet
          and the related consolidated statements of income, of
          shareowners' equity and of cash flows present fairly, in all
          material respects, the financial position of Ingersoll-Rand
          Company and its subsidiaries at December 31, 1995 and 1994, and
          the results of their operations and their cash flows for each of
          the three years in the period ended December 31, 1995, in
          conformity with generally accepted accounting principles.  These
          financial statements are the responsibility of the Company's
          management; our responsibility is to express an opinion on these
          financial statements based on our audits.  We conducted our
          audits of these statements in accordance with generally accepted
          auditing standards which require that we plan and perform the
          audit to obtain reasonable assurance about whether the financial
          statements are free of material misstatement.  An audit includes
          examining, on a test basis, evidence supporting the amounts and
          disclosures in the financial statements, assessing the accounting
          principles used and significant estimates made by management, and
          evaluating the overall financial statement presentation.  We
          believe that our audits provide a reasonable basis for the
          opinion expressed above.

               As discussed in Note 1 to the consolidated financial
          statements, the Company changed its method of accounting for
          postemployment benefits in 1993.


          /S/ Price Waterhouse LLP
          PRICE WATERHOUSE LLP





                                         175<PAGE>